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Pennsylvania: Pa. High Court To Decide If Gas Stations Can Sell Beer

Pennsylvania: Pa. High Court To Decide If Gas Stations Can Sell Beer


Source: Law360

By Dan Packel

February 16, 2016


The Pennsylvania Supreme Court said Tuesday that it would hear an industry group representing beer distributors’ appeal of a 2015 decision that allowed Sheetz Inc. to sell alcohol at locations that also sell gasoline.


The high court will examine a Commonwealth Court ruling that found the state’s Liquor Control Board had appropriately issued licenses to the two retailers. While state regulations forbid entities that sell gasoline from also selling alcohol, the opinion said that a Commonwealth Court ruling from 2014 had allowed a license to be transferred to a cafe within a grocery store that planned to operate gas pumps on grounds that the cafe was clearly demarcated as a separate business entity.


The primary question, as presented by the Malt Beverage Distributors Association and Gabler’s Beverage Distributor Inc., is: “Can a single store sell both gasoline and beer without violating the liquor code?”


The case under appeal deals with an application to transfer a liquor license to a restaurant located within a Sheetz gas station. The LCB signed off on the transfer, prompting the distributor and the industry group to seek a reversal in the Commonwealth Court.


There, however, a panel concluded that the restaurant was operated as an independent business, albeit under the Sheetz flag, and was separated from the gas station and convenience store by a wall.


The court rooted its decision in a 2014 ruling in Water Street Beverage Ltd. v. Pennsylvania Liquor Control Board. That case dealt only with interpreting provisions of the liquor code prohibiting the the transfer of liquor licenses to a “location where the sale of liquid fuels or oil is conducted.” There, the court said that the term “location” had to be defined in relation to the particular area where the alcohol sales would take place.


Left uninterpreted in the Water Street decision, however, were separate provisions of the code prohibiting the transfer of licenses to a “place or property upon which is located as a business the sale of liquid fuels and oils.”


In its permit decision, the liquor control board concluded that the terms “place” and “property” could not reasonably have meanings that differed from the Commonwealth Court’s interpretation of the term “location.”


The Commonwealth Court agreed, saying that interpreting “place” and “property” differently than it had interpreted “location” would lead to licenses being able to be issued to some entities under the “location” provisions but not to similarly situated entities under the “place” and “property” provisions.


The appellants’ other two questions for the court referenced this ambiguity, seeking definitions of both “location” and “place or property.”


“We are pleased that the Supreme Court is going to decide this very important issue, and I look forward to arguing it,” said Matthew Haverstick of Kleinbard LLC.


A representative for the LCB did not immediately respond to a request for comment.


The challengers are represented by Matthew Haverstick and Joshua Voss of Kleinbard LLC and Charles Caputo of Caputo Caputo & Regan PC.


Sheetz is represented by Stanley Wolowski, Mark Flaherty and Mark Kozar of Flaherty & O’Hara PC and William Caroselli of Caroselli Beachler McTiernan & Coleman LLC.


The PLCB is represented by in-house counsel Faith Diehl, Rodrigo Diaz and Robert McAteer.


The case is Malt Beverage Distributors Association et al. v. Pennsylvania Liquor Control Board, case number 8 MAP 2016, in the Supreme Court of Pennsylvania.