TTB’s Chicagoland notices about wholesalers’ violations of trade practices and other statutes pose some interesting questions
Two recent announcements from the United States Department of Treasury’s Tax and Trade Bureau show that the TTB’s ongoing enforcement actions in the Chicagoland area are producing results.
The first is the recent case of Skokie Valley, where it apparently started selling its brands before the TTB announced a related trade investigation into other practices had uncovered that Skokie Valley did not hold a valid permit.
What’s interesting about the Skokie Valley enforcement is that about a month before the TTB reported it was revoking the license, the Chicago Tribune reported that Skokie Valley was closing and selling brand rights to other distributors. Given that most beer wholesaler agreements and Illinois’ Beer Industry Fair Dealing Act allow a brewer to terminate an agreement without notice if a wholesaler loses its license, one wonders if the brewers were informed that they might be in a position to terminate their agreements and potentially reclaim rights prior to the brand transfers – whether Skokie Valley knew it was the subject of an investigation at the time the sales of the brands were going on and whether it informed the brewers of that fact before asking/selling the brands to other distributors.
The second came out on Friday reporting that the TTB had accepted a $325,000.00 offer in compromise from Elgin Beverage Co., in connection with alleged tied house violations such as paying money to a retailer to promote the wholesaler’s distributed beers over others’. One wonders if this was even to the detriment of its own craft brands such that they may have been impacted by the alleged activities.