Craft Beer Wholesaler to Pay $2 M Fine to Settle Trade Practice Violations

Posted in Beer & Spirits

Attorney General Christopher S. Porrino and the Division of Alcoholic Beverage Control announced a settlement with a Hunterdon county craft beer wholesaler, resulting in a record $2 million fine for alleged trade practice violations.

The Division alleged that Hunterdon Brewing Company LLC sold draft beer tap systems below fair market prices and mislabeled the charges as “miscellaneous” on invoices to conceal them. The Division alleged that the company also ignored credit regulations for at least 700 retail customers. In addition to reviewing thousands of documents, the Division compiled sworn statements from more than two dozen retail licensees.

Hunterdon Brewing agreed to the fine in a Consent Order. The fine is the largest fine ever imposed on a single wholesale license for trade practice violations. The offenses as alleged consist of violations of New Jersey statutes and regulations governing the sale and distribution of alcoholic beverages.

Attorney General Porrino stated that the alleged improper trade practices used by Hunterdon Brewing threatened to disrupt competition and the wholesale industry. He said that the Division’s actions in investigating the alleged trade practice violations “ensure that consumers will benefit from a stable alcoholic beverage industry.”

According to Jonathan Orsen, Acting Director of the Division of Alcoholic Beverage Control, the Division strives to create “a level playing field that encourages fair, open, and transparent competition.” Discriminatory trade practices stifles competition among wholesalers and consumers lose the benefits provided by open competition, he added.

The fine is to be paid in four equal installments over the next year. The Division will waive $250,000 of the final installment if compliance audits show no similar violations.