An innovative supermarket has sparked a legal battle in Pennsylvania.
Wegmans, the high-end supermarket chain, recently opened a new store near Collegeville. This location marks the seventy-fourth store in its chain and the fourteenth in Pennsylvania. Wegmans stores usually boast coffee shops, bakeries, and extensive gourmet food sections. Many include a Market Café eatery, and some even have an on-premises daycare for children. The Collegeville Wegmans, however, offers something that you will not find in any other Pennsylvania supermarket: a pub within the store that serves wine and beer on tap. The Collegeville pub is a first for the Wegmans chain as well. While the Pennsylvania Liquor Control Board (“LCB”) recently allowed select supermarkets to sell takeout beer and others to have State Liquor Store outlets within the premises, this is the only supermarket in Pennsylvania, with an actual pub serving alcohol for consumption on the premises. Moreover, all of the Pennsylvania Wegmans have obtained restaurant liquor licenses; and, if the model works in Collegeville, Wegmans plans on replicating it at other Pennsylvania stores and may even include outlets in other states.
The pub is styled to resemble a traditional Irish pub. It is situated in the Market Café section of the store. While the pub opens up to offer views of the supermarket, it is located in an area segregated from the rest of the store and has an interior connection to the main store. The pub features an open kitchen where patrons can watch the Wegmans’ chefs preparing food. For legal and accounting purposes, it is treated as a separate business even though it operates under the same roof as the main store. The pub offers beer and wine for on-premises consumption and can sell up to two six-packs for takeout. The pub does not sell pitchers or have happy hours, and wine is only sold for consumption in the pub. Specialty beers and imports make up the majority; of the takeout beer offerings, which include about 750 labels. Wegmans maintains that the beer and wine sold is designed to complement the food sold in the Market Café as well as the gourmet food section of the store.
While most people do not object to the on-site consumption that goes on in the pub, a group of beer distributors has asked the Pennsylvania Supreme Court to determine whether the LCB improperly applied the rules to allow the pub’s sale of takeout beer. The distributors argue that the LCB’s decision to permit beer sales circumvents fundamental Liquor Code rules that are intended to establish and limit the locations where beer may be sold. The distributors contend that the LCB’s interpretation of the terms “interior connection” and “other business” contained in the Liquor Code are at odds with the LCB’s mission to regulate and restrict the sale of alcohol. For example, the distributors argue, big box stores with small food courts, movie theaters with concession stands, and bookstores with coffee shops would not be entitled to such a license; therefore why should supermarkets, such as Wegmans, be granted one?
Supermarkets including Wegmans counter that interior connections have been allowed in Pennsylvania since the repeal of prohibition. For decades many delis and convenience stores have been licensed to sell takeout beer the same way Wegmans does now. The beer distributors maintain that supermarkets such as Wegmans are much bigger than the delis and convenience stores that have traditionally been permitted to sell beer. Supermarket representatives point out that the Liquor Code makes no mention about the size of an establishment selling takeout beer and that any such change would require action by the Legislature.
Arguments are expected before the Pennsylvania Supreme Court in April 2010. We will keep you posted.
— J. Kenneth Butera