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Bethany (Beth) K. Hatef advises clients on a wide variety of regulatory and distribution issues in the alcohol beverage industry. Beth regularly counsels alcohol industry clients on federal and state requirements relating to the production, marketing, distribution and sale of beer, wine and spirits. Read Beth Hatef's full bio.

Late last month, the Texas Supreme Court issued a ruling in Cadena Comercial USA Corp. d/b/a OXXO v. Texas Alcoholic Beverage Commission, finding in favor of the Texas Alcoholic Beverage Commission (TABC) and weighing in for the first time on the application of Texas’ tied house law. In a 6-2 decision, the court upheld the TABC’s denial of a retail permit to a foreign corporation whose parent company also holds a 20 percent ownership interest in a foreign brewer.

Fomento Económico Mexicano, S.A.B. de C.V. (FEMSA) holds both a 20 percent interest in the stock of two Heineken entities, as well as–through intermediate holding companies–100 percent of the ownership of Cadena Comercial USA Corp. (Cadena), a company that operates convenience stores. In 2011, Cadena sought licensing as a beer and wine retailer in Texas.  During the license application process, the TABC discovered FEMSA’s ownership of Cadena and interest in Heineken and rejected Cadena’s permit application on tied house grounds. Texas’ alcohol beverage laws define “tied house” as prohibiting any overlapping cross-tier ownership interest.

Upon the denial of its permit application, Cadena requested and received an administrative hearing before a county judge. At the hearing, the TABC’s director of licensing testified that that the TABC would consider even one overlapping share of stock across tiers to violate Texas’ tied house laws. (This principle is referred to as the “One Share Rule.”) The judge denied Cadena’s retail permit application, finding that because of Cadena’s interests in a brewer/manufacturer, issuance of the permit would violate the tied house laws. On appeal, both the district court and the court of appeals affirmed the denial of the permit.


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To follow up on our prediction last month that the Trump Administration may take a more aggressive stance toward the legalization of marijuana, White House Press Secretary Sean Spicer stated during the February 23 daily briefing that he anticipates greater federal enforcement of marijuana laws.  Spicer emphasized the distinction between medical marijuana (the legalization of

Last week, the US Court of Appeals for the Eighth Circuit weighed in on the legality of restrictions on alcohol advertising under the First Amendment, issuing an opinion in Missouri Broadcasters Association v. Lacy that could eventually broaden free speech protections for alcohol beverage advertisements. After the lower court granted defendants’ motion to dismiss and

Late last week, a district judge in Texas declared unconstitutional under the Texas Constitution a provision of the state’s Beer Industry Fair Dealing Law (i.e., the beer “franchise” law) that expressly prohibits a brewer from accepting a payment in exchange for a grant of territorial distribution rights.  Section 102.75(a)(7) of the Texas Alcoholic

On January 7, 2016, the U.S. Court of Appeals for the Ninth Circuit issued an opinion in Retail Digital Network, LLC v. Appelsmith, overruling longstanding Ninth Circuit precedent concerning the legality of certain restrictions on alcohol beverage advertising under the First Amendment and opening the door to part of California’s tied-house scheme potentially being

Hard cider has shown phenomenal growth in the past several years.  With rising consumer demand, more and more craft brewers are entering this rapidly expanding market. Although hard cider is typically distributed and mar­keted like a beer product, the federal gov­ernment and most states actually tax and regulate cider as a type of wine.  Brewers