Deep Ellum Brewing Co. has filed a lawsuit against the Texas Alcoholic Beverage Commission challenging the constitutionality of Texas Alcohol Beverage Code provisions forbidding brewers from selling their alcohol products on-site for off-premises consumption. Deep Ellum Brewing Co. v. Tex. Alcoholic Beverage Comm’n, No. 15-0821 (W.D. Tex, Austin Div., filed September 14, 2015). Dubbing the campaign “Operation Six Pack To Go,” the brewery argues that distilleries, wineries and brewpubs can sell their products in to-go packaging but breweries cannot, resulting in an unconstitutional distinction in the law.
Texas alcohol codes distinguish between manufacturers, distributors and retailers, prohibiting overlapping ownership but creating exceptions for particular conditions, the complaint asserts. One such condition allows manufacturers to act as retailers in certain situations, such as at wineries and brewpubs. Deep Ellum Brewing alleges that because of this provision, it “has lost and continues to lose business (and resulting profits) because it cannot sell its product on-site for off-premises consumption.” The brewery cannot obtain a brewpub license, which would allow for such sales, because its production of 12,500 barrels of beer surpasses the maximum of 10,000 barrels required to obtain the license.
This distinction amounts to equal protection and substantive due process violations, Deep Ellum Brewing argues, by creating an “arbitrary and irrational discrimination” that cannot be defended even at the lowest level of scrutiny, the rational basis test. The brewery seeks declaratory judgment and a permanent injunction against the enforcement of the contested provisions. “We are sorry that legal action is the only way to bring about fairness in an antiquated system that has failed to adapt to the legal, social, and commercial changes of the past 82 years,” John Reardon, owner of Deep Ellum Brewing, said on a crowdfunding website for Operation Six Pack To Go.