Massachusetts: Regulators decline to punish bar owner who admitted taking payments

Source: bostonglobe.com

By Dan Adams

July 29, 2016

Massachusetts alcohol regulators on Friday declined to punish a bar whose owner admitted taking $20,000 in payments from a beer distributor, dealing a setback to state investigators who had vowed to crack down on so-called “pay-to-play” in the state’s beer industry.

Investigators at the Alcoholic Beverages Control Commission had cited a now-closed South End restaurant, Estelle’s, after its owner, the Wilcox Group, admitted that it took $20,000 from the Craft Brewers Guild to reserve 20 tap lines at its bars for the distributor’s beers.

The Wilcox Group owns a number of popular Boston-area bars, including The Lower Depths, Bukowski Tavern, and the Rattlesnake Bar & Grille. Estelle’s was the only Wilcox establishment cited by investigators.

But in their ruling Friday, two ABCC commissioners said there was not enough evidence proving the payments were specifically for tap lines at Estelle’s. The commission has the power to sanction only establishments that hold state liquor licenses, and so could not directly punish the Wilcox Group, since the parent company does not itself hold a liquor license.

“While it is clear that and apparently undisputed that Wilcox received $20,000 as a bribe for 20 dedicated tap lines in Wilcox-managed restaurants, there is nothing in the record that shows” Estelle’s received the money, the commissioners wrote in their ruling.

“Obviously, we’re pleased with the decision,” said James Byrne, an attorney for Wilcox. “It’s been a long and sometimes exhausting process and we’re looking forward to moving on.”

The Wilcox Group was one of five restaurant companies charged by the ABCC last year with receiving illicit payments from Craft Brewers Guild, part of an ongoing investigation into pay-to-play.

Inducements like those paid to Wilcox, while common and legal in grocery stores and other industries, are generally prohibited under the unique regulations governing the alcohol business.

In February the ABCC suspended Craft Brewers Guild’s license for 90 days for providing the payments to bars. The distributor, part of a multistate network of wholesalers controlled by the Sheehan Family Cos., paid a record $2.6 million fine to avoid the suspension, but later challenged the sanction in state court. That case is still pending

The cases of the four other restaurant companies are pending. In their decision Friday, the commissioners noted that the agency’s investigators did have evidence linking payments from Craft Brewers Guild to specific bars owned by the four other restaurant groups.

Two of those, an affiliate of the Cronin Group and the Glynn Hospitality Group, have already argued their cases before the commissioners and are awaiting a decision. The other two, the Lyons Group and the Briar Group, have hearings scheduled in September.

The ABCC investigation began in late 2014 after Dann Paquette, cofounder of the Pretty Things brewery, posted on Twitter about the prevalence of pay-to-play, and singled out bars owned by the Wilcox Group as the recipients of such payments. The company’s owner, Gordon Wilcox, fired back, accusing Paquette of making middling, overpriced beer.

Estelle’s closed over a year ago. It was briefly rebranded as Cluckit, a chicken restaurant, but Wilcox closed that venture last October.

Officials said they would now move ahead with approving a transfer of the Cluckit liquor license to Douglass Williams, an up-and-coming chef and restaurateur who plans to open an Italian-influenced restaurant dubbed MIDA in the space later this year.