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Austin's Jester King Craft Brewery Sues the TABC, But Is the TABC Really the Bad Guy?

Jester King, based in Austin, is one of the state's most popular craft breweries. The TABC (or Texas Alcoholic Beverage Commission), also based in Austin, is one of the state's most powerful agencies. And with news that Jester King has just filed a lawsuit against the TABC, our capital could soon become a boxing ring for the ultimate beer battle as the little guys finally take on Big Government.

"We have sued the TABC because we believe that its Code violates our rights under the 1st and 14th Amendments to the Constitution of the United States," wrote Jester King on its website yesterday. "Under the Code, we are not allowed to tell the beer drinking public where our beer is sold. We are also not permitted to use accurate terms to describe our beers. We are often forced to choose either to label them inaccurately or not to make beers that we would like to brew."

The brewery went on to state: "Under the bizarre, antiquated naming system mandated by the TABC Code, we have to call everything we brew over 4% alcohol by weight (ABW) 'Ale' or 'Malt Liquor' and everything we brew at or below 4% ABW 'beer.' This results in nonsensical and somewhat comical situations where we have to call pale ale at or below 4% ABW 'pale beer' and lager that is over 4% ABW 'ale.'"

Jester King -- like other breweries in Texas -- also takes issue with the fact that wineries are allowed to sell their product to the public at their facilities, while breweries aren't. It's the same issue that was brought to the State's attention earlier this year with proposed House Bills 660 and 602, although neither bill passed the Legislature.

The lawsuit itself takes TABC to the woodshed for its bureaucratic dysfunction in a beautifully written argument on page five of the Motion for Summary Judgment:

When questioned at its Rule 30(b)(6) deposition, the TABC could identify no substantial government interest that is advanced by preventing breweries from telling customers where their beer can be bought. The TABC agrees that the ban does not "promote the welfare, health, peace, temperance or safety of the people of Texas," that it does not "promote legal and responsible alcohol consumption," and that it does not "ensure fair competition with the alcohol beverage industry.'' The only government interest the TABC could articulate was to "[e]nsure consistent, predictable and timely enforcement of" the Texas Alcoholic Beverage Code. The TABC frankly recognized that its rationale - "It's the law, and that's the end of it" - circular reasoning that justifies enforcing the Code simply because it is the Code.

Public excitement over the lawsuit ran high, with craft beer fans taking to Twitter in joyous bleets: "This is HUGE," wrote Bill Norris, beverage director at Austin's Alamo Drafthouse. "I hope they win!" added Jodi Bart, an Austin-based food blogger.

But just like the excitement over HB 602 and HB 660, craft beer supporters could be in for more disappointment in the long run.

Leslie Sprague of Open the Taps, a grassroots consumer advocacy group that represents craft beer enthusiasts in Texas, cautions against the idea that this lawsuit will effect any immediate change in our alcoholic beverage code. "I can't say if I think something is going to happen," Sprague said by phone. "We would love for something to happen. Our beverage code needs to be overhauled and evaluated."

But summary motions are rarely granted -- meaning the lawsuit will more than likely go to court -- and First Amendment rights are a tricky legal area, especially when applied to companies. The First Amendment rights of citizens are protected, but what about corporations?

While Sprague agreed that the lawsuit is "probably [Jester King's] best bet" after the failure of HB 602 and HB 660, she said that the more likely outcome of the lawsuit in the long run is "an opportunity to educate people on these silly laws."

Sprague was also quick to point out that the TABC isn't the bad guy in this situation. "They're just the messenger carrying out the laws," she said. "You have to sue TABC [over these laws], but they don't necessarily make them." The real bad guys, she pointed out, are "our laws as they stand."

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"There's a number of things that are at issue here," she said. "The Legislature not voting for House Bills 602 and 660, people not calling their legislators to make their voice heard. These are the things that are important to us."

Regardless of the lawsuit's ultimate outcome, one thing is certain: "Nothing has caused quite the commotion as this has," Sprague said. "I think it's a big step, it shows that we're serious. In general, the craft beer community in the state is ready for some changes."

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