That was quick. Just days after we reported “more coming” from TTB enforcement actions in IL (see Mar 25 issue), it announced $350K offer in compromise from Brewers Distrib Co in Peoria, IL. And just days after that, TTB announced $2.5 million offer from Heineken USA, its biggest haul on record. Those offers followed a $1.3-mil deal TTB cut with Seattle distiller in early Mar. All in, TTB got offers for over $4 mil in less than 1 month. And that’s on top of collective $2.7 mil TTB collected from Eagle Brands in FL ($1.5 mil), Elgin Dist (IL) and Warsteiner Imports in 2018 ($900K). Those multi-mil allocations the agency got for expanded trade practice investigations starting to pay off for Feds. But more folks starting to push back against TTB’s perceived overreach too. Stay tuned.
In Illinois, TTB tagged Brewers Dist Co (AB, HUSA, craft) for allegedly selling products to retailers with right of return. BDC also “required retailers to purchase their products,” an exclusive outlet violation under FAA Act. After investigation in Florida, then in NYC and WA, TTB alleged “Heineken USA provided some retailers with BrewLock draft systems at no charge and reimbursed other retailers for the cost of purchasing BrewLock draft systems.” Those payments “disguised” as credit card swipes. Since BrewLocks only work with Heineken kegs, TTB sez HUSA “obligated and induced” retailers to exclusively buy Heineken products. TTB also alleged HUSA: 1) “made slotting fee payments to retailers and disguised those unlawful payments as payments for permissible activities (such as consumer sampling)” that never happened; 2) used 3d parties to pay additional slotting fees. HUSA said it “doesn’t admit to any violation of the law,” and it “has been and remains committed to legal compliance in everything we do.” It also adopted “enhanced and robust compliance program” and “internal audit process.” Finally, distiller Sun Liquor in Seattle allegedly “failed to timely file and pay excise taxes” on spirits sold to airline carriers not eligible for export credit, TTB charged.
And there’s more to come, no doubt. TTB seeks big bucks from another distrib and big supplier too, INSIGHTS hears. Importantly, TTB targets and tags growing in size from tiny vintners/distribs nailed for consignment sales. That “progressive discipline” viewed by some as counter to due process. Yet TTB “remains committed to putting an end to anti-competitive practices that hurt law-abiding businesses and prevent consumers from enjoying a wide selection of products,” the agency said announcing HUSA offer.