Fla. Court Lets Caterers Receive Offsite Alcohol Deliveries

Source: https://www.law360.com/

By Nathan Hale

June 30, 2020

By ruling that a Miami-area vendor can receive alcohol deliveries directly to offsite catered events, Florida’s First District has served up both a major blow to state regulators but also a “hollow victory” for now for the business, its counsel said, with major events canceled due to the COVID-19 pandemic.

In a 2-1 decision, the appeals court on Monday reversed a declaratory statement issued by the Division of Alcoholic Beverage and Tobacco, which said that licensed vendors, such as appellant MB Doral LLC, cannot receive alcohol deliveries at catered events where state law says they are allowed to sell alcohol “without any additional licensure.” The majority said it found no authority to support the division’s position.

“The irony of the whole thing is it can’t take immediate benefit of it because of the pandemic,” attorney Louis J. Terminello of Greenspoon Marder LLP said of his client, which operates the Martini Bar Doral night club near Miami and provides catering services at music festivals, boat shows and other large-scale events. It has suspended operations since mid-March.

The decision is critical for MB Doral’s business plans because the on-site deliveries will eliminate costs for the vendor to receive alcohol at its business location and then separately transport it to the event site, according to the opinion.

But Terminello also suggested the outcome of the case – in which alcohol wholesalers intervened in opposition to MB Doral’s position – could have an even greater impact because the majority found this permission did not need to be specifically authorized in the state’s beverage law.

“Although the client is satisfied, from a legal perspective, it’s good news for the beverage law that licensees can now have some clarity that unless something is specifically prohibited it is permitted conduct,” Terminello said. “That has always been a complicated issue.”

In its analysis, the majority – consisting of Judge James R. Wolf and Judge L. Clayton Roberts – said the provision establishing the “catered-event exception,” says nothing about the transportation and delivery of alcohol, and the separate statute that regulates the transportation of alcohol for resale also contains no restrictions on “when, where or how a distributor may make deliveries, so long as the deliveries are made in an appropriately licensed vehicle.”

“In fact, nothing in the text of chapter 561, the Beverage Law, the department’s rules, or any other authority the department cites prohibits distributors from making (or vendors from accepting) alcohol deliveries at catered-event sites where alcohol may be sold,” the court said.

The majority rejected DABT’s conclusion that the beverage law’s silence on the matter indicates that the Florida Legislature intended to bar deliveries anywhere other than the “licensed premises” specified in a vendor’s alcohol license.

“[I]n arguing that catered-event-site deliveries are unlawful because the beverage law does not explicitly authorize them, the department ignores the fact that the beverage law likewise does not explicitly authorize licensed-premises deliveries. In fact, the beverage law does not explicitly authorize delivery anywhere; it is silent on that,” the opinion said. “We cannot from this hold that catered-event-site deliveries are unlawful.”

The appeals court also rejected an argument raised by the intervenors – the Florida Beer Wholesalers Association, Beer Industry of Florida Inc. and Florida Beer Wholesalers Association Inc. – that the department could not issue a declaratory statement because the issue would amount to a rule of general applicability that must be handled through the rulemaking process.

“It is unclear why a declaratory statement the other way – like the one on appeal – would not likewise be subject to the same argument: If a declaratory statement announcing a practice’s lawfulness is a rule of general applicability, so too is a statement announcing a practice’s unlawfulness,” the majority said.

District Judge Susan L. Kelsey strongly disagreed in her dissent, saying that under the state’s three-tiered manufacturer-distributor-vendor regulatory structure for the alcohol industry, “What a distributor can do and what a vendor can do are two separate things.”

The beverage law, she said, contains a “blanket rule/limited exception framework” that bars all deliveries of more than 12 bottles of alcoholic beverages aside from a list of exceptions, none of which covers the scenario presented by MB Doral.

“Because the legislature enacted a general prohibitive rule and then expressly created limited exceptions to that rule, we are not at liberty to expand the enumerated exceptions by judicial fiat as the majority has done,” Judge Kelsey said.

Representatives for the Department of Business and Professional Regulation, which houses the DABT, and counsel for the wholesalers did not immediately respond to requests for comment late Tuesday.

Judges James R. Wolf, L. Clayton Roberts and Susan L. Kelsey sat on the panel for the First District.

Martinbar is represented by Louis J. Terminello and Michael Martinez of Greenspoon Marder LLP.

Florida Beer Wholesalers Association, Beer Industry of Florida Inc. and Florida Beer Wholesalers Association Inc. are represented by Donna E. Blanton and Thomas A. Crabb of Radey Law Firm.

The DBPR is represented in house by Ross Marshman and Beth A. Miller.

The case is MB Doral LLC v. Florida Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco et al., case number 1D18-1713, in the First District Court of Appeal of Florida.