More wackiness in the three-tier system
by Wine Curmudgeon Posted On
Manufacturer-wholesaler lawsuit shows just how Kafkaesque the whole thing is
The three-tier system, the set of rules regulating how wine is sold in the U.S., has always taken the term Kafkaesque and turned it on its head. Which is saying something, given what Kafkaesque means.
But one recent development is even more Kafkaesque than that.
The second biggest wholesaler in the country and one of the most important spirits manufacturers are locked in a lawsuit, the details of which defy explanation.
On the one hand, the producer, New Orleans’ Sazerac, says the wholesaler, RNDC, is trying to cheat it and is acting illegally. On the other, Texas’ RNDC says Sazerac is trying to cheat it and is acting illegally.
Which is weird enough, given that lawsuits like this are rare if only because Sazerac is suing one of the few companies that can legally sell its products in the U.S. But it’s even more rare, as this report notes, because it shows “the acrimonious and unusually public feud between Sazerac and RNDC.”
The entire piece, though difficult to get through (even for those of us who understand what’s going on), is worth reading. The venom and vitriol are mind-boggling; RNDC claims Sazerac is trying to destroy the three-tier system, while Sazerca says RNDC is trying to put it out of business.
The one question that the story doesn’t discuss: Why is Sazerac doing this? Typically, the courts have ruled that the wholesaler is always right, given that its role in the alcohol business is protected by the Constitution. So it almost certainly can’t win.
Perhaps it expects to settle and get most of what it wants, on the theory that RNDC doesn’t want its business practices outlined in open court. There’s precedent for this, though not in booze. Art Buchwald’s 1990s lawsuit against Paramount over who wrote “Coming to America” was supposed to detail Hollywood’s biggest scam: The “net profits’ fraud, that no movie ever makes money. But Buchwald settled before that happened.
Or, perhaps, as three-tier opponent Tom Wark always hopes, Sazerac is trying to strike a blow against three-tier and sees this – as some do – as the opportune time. We, too, can only hope.
Picture: “File:Portrait of a Man sitting (Franz Kafka), Léon Weissberg.jpg” by Lydie Lachenal is licensed under CC BY-SA 4.0.