Texas Lawsuit Could Bring About To-Go Sales at Breweries

Austin Ray

THE GIST
A contentious fight in Texas could bring about big changes to how the state’s craft brewers operate. Dallas’ Deep Ellum Brewing is awaiting a ruling on a lawsuit it filed earlier this year against the Texas Alcoholic Beverage Commission, challenging a law that prohibits brewers in the state from selling beer to go.

As the law is written, Texas wineries, distillers, and, yes, even brewpubs, can sell booze to visitors for off-premise consumption. It’s worth mentioning that while Texas brewers aren’t legally permitted to sell beer to go, they can, in fact, sell a limited amount for on-premise consumption. No less, brewers promoting this change see it as another necessary step toward leveling a playing field currently tilted against them. The conflict—a ruling for which is expected soon, according to Fort Worth Weekly—is merely the latest in a string of beer brawls that have broken out in the Lone Star State in recent years.

WHY IT MATTERS
In September 2015, Deep Ellum founder John Reardon raised nearly $35,000 as part of a crowdfunding effort to fund this suit, dubbed “Operation Six Pack To Go.” I interviewed Reardon after the campaign launched last year. “It’s about equal rights. It’s about leveling the playing field,” he told me at the time, before invoking the strides the industry had been making elsewhere. “It’s not, ‘We’ve got enough, we’re going to back down now.’ We want the game to continue to become more fair.”
 
The more interesting wrinkle here is the difference between brewers and brewpubs. Wineries and distillers being able to do things beer makers can’t, that’s one thing—even if it’s still at odds with common sense. It becomes a little trickier to explain why some beer manufacturers can do stuff that others can’t. 
 
But it basically comes down to permits. A brewer’s permit allows manufacturers to produce up to 225,000 barrels per year and sell a limited amount of beer for on-premise consumption. However, it prohibits them from selling beer for off-premise drinking. Conversely, a brewpub license affords the at-issue right to sell beer to-go, but has a much, much more stringent production cap of 10,000 barrels annually. This delineation isn’t unique to Texas, of course, so feel free to read the rules for yourself, if you're into that sorta thing.
 
This dichotomy presents itself clearly in predictable ways. When brewers—like Deep Ellum—produce more than 10,000 barrels, you get these types of fights. They’re too big to obtain a brewpub permit, but they want some of the privileges that come with having one. For smaller brewers, there is some more wiggle room in the licensing arena. Renowned Texas Hill Country operation Jester King changed from a brewer to a brewpub in the eyes of the state for this very reason. 

“We will be changing our license to a Brewpub,” the company wrote on its website in 2013. “That is not actually as dramatic as it may sound. The change is somewhat of a formality, because it will simply allow us to sell bottles of our beer to go.”
 
And it's not as though the lines between the two types of businesses haven't been getting blurrier before this effort. In 2013, then-governor Rick Perry signed into law a number of bills that, among other things, finally allowed for brewers to sell beer for on-premise consumption, and enabled brewpubs to sell their wares through a wholesaler. So this lawsuit, in a way, simply aims to further blur the line between brewer and brewpub.
 
—Dave Eisenberg
 
READ MORE
Texas Beer Wars [Fort Worth Weekly]