Business Monday: Aspen liquor store, grocer to face off in beer trial this week
It will be up to a Pitkin County district judge this week to decide whether to put a lid on the sale of full-strength beer at Clark’s Market.
Aspen Wine & Spirits and Clark’s Market are scheduled to face off Wednesday through Friday in a court trial presided over by Judge Chris Seldin, who will determine if the liquor store has the exclusive right to sell fully potent suds and seltzers from its location at the Clark’s Market shopping complex on Puppy Smith Street.
Attorneys for Clark’s Market say the grocery store is within its contractual rights to sell the beer and other carbonated adult beverages, which returned to the Aspen location’s shelves earlier this month after a near one-year hiatus.
The trial will come after Aspen Wine & Spirits filed suit in September 2018 seeking legal recourse to stop Clark’s Market from selling full-strength beer, arguing the grocer was only allowed to sell lower-strength beer with 3.2% alcohol content.
So far, the litigation has yielded mixed results.
A favorable one for the liquor store came July 14 when Seldin remanded Clark’s application to sell full-strength beer to the Local Licensing Authority, which in July 2018 originally voted 4-1 in the application’s favor. Seldin’s ruling concluded the LLA hadn’t fully reviewed the application, which is why he sent it back to the board for further review.
As a result, Clark’s stopped selling beer or alcoholic beverages of any sort. Yet the LLA once again approved the grocer’s application to sell beer at a Nov. 18 hearing, and on May 1 the supermarket returned full-strength beer — as well as hard cider, seltzer and kombucha — to its coolers.
Clark’s Market is located across the hallway from Aspen Wine & Spirits.
The liquor store is seeking of $33,872 for the full-strength beer the grocer sold in 2019 and disgorgement of $38,813.38 in net profits Clark’s made through the sale of full-strength Clark’s fermented malt beverage products for a portion of 2020, according to court records.
Attorneys for Clark’s Market have argued it is allowed to sell beer not only because it has the LLA’s approval but for other reasons also.
For one, the sublease Aspen Wine & Spirits agreed to in 2000 when it took over the location is not applicable to the current situation. As a third-party beneficiary to the lease, Clark’s was not allowed to sell full-strength beer, but attorneys for the grocer said the beer clause only applied to the supermarket’s relationship with the predecessor of Aspen Wine & Spirits.
As well, while the sublease said Clark’s could sell only 3.2 beer, the supermarket contends the weaker brew is not available in Colorado anymore in the aftermath of last decade’s passage of a state liquor law allowing supermarkets to sell full-strength beer.
“Rather, the lease expressly allows Clark’s to sell full strength beer if the 3.2 category of beer no longer exists or is changed,” Seldin wrote in a May 19-dated trial order summarizing each side’s argument. “Following an overhaul of Colorado’s liquor licensing regulations passed in 2016, effective Jan. 1, 2019, 3.2 beer is no longer separately regulated, and that category is no longer sold by Clark’s distributors. Therefore, both Clark’s liquor license and lease allow it to sell full-strength beer.”
Aspen Wine & Spirits, however, has argued that when Clark’s Market in the spring of 2018 applied for its license to sell 3.2 beer, it did with the intent to replace it with the full-strength version at the start of 2019. Whatever the case, it should not be selling full-strength beer in Aspen, contended the plaintiffs. Weaker beer also is available for distribution in Colorado, Aspen Wine & Spirits claimed.
“If beer containing 3.2% alcohol by weight or less is brewed and available, as it is, Clark’s may sell it. But Clark’s may not sell full-strength beer.
Richard Neiley Jr., who is counsel for Aspen Wine & Spirits, and Hoskin Farina & Kampf PC, which is the law firm representing Clark’s Market, did not return messages last week seeking comment.