A-B Wins Right to Distribute in IL

I a far reaching decision, with many implications for craft brewers, Illinois liquor regulators ruled today that Anheuser-Busch can retain its minority ownership stake in a Chicago beer distributorship.

In 2010, A-B informed Illinois regulators that it intended to buy out City Beverage of which it owned 30 percent of.

But the liquor commission blocked the deal to preserve the state’s three-tier system. A-B took the matter to court, citing the several Illinois craft who distribute their own beer and that keeping the company out of the distribution business discriminated against out-of-state brewers.

A federal judge sided with Anheuser-Busch this year and ruled the state law was discriminatory. But the judge denied the company’s request to remedy the law by granting out-of-state brewers the right to distribute their own products in Illinois. Instead, the judge left it to the General Assembly to clarify the state’s distribution rules.

Legislators responded by creating a law in 2011 that banned in-state and out-of-state brewers from self-distribution. They granted limited rights to craft brewers.