Sheetz wages war against mandatory on-premises sales.

Sheetz again will ask to own a retail license but not sell on-premises. They lost before in a suit filed by the MBDA, but still want this. So do most other convenience stores, grocery stores, Wal-Mart and Costco. They want to convert an “R” to a “small package distributor’s license” selling wine and beer for takeout without offering alcoholic beverages on premises.

According to the Altoona Mirror, this battle started again in Logan Township, Blair County, where, as part of a municipal transfer application, the Sheetz attorney told the supervisors that, “based on a recent LCB advisory, Sheetz does not expect to serve alcohol in the store”.

Apparently, relying on this representation, the supervisors approved the transfer.

Question is whether this lawyer has gotten “out over his skis” since the two most relevant Supreme Court opinions makes clear this is not the law, as does a recent LCB ruling. The Board, in a private opinion, noted that the Supreme Court has held that a Sheetz with an eating place license must sell on-premises. The court in that case reasoned that to rule in any other way would destroy the niche marketplaces held by home distributors and bona fide taverns.

The January 2, 2018, Advisory Opinion makes note of this decision and says, “It is unclear whether this holding would also extend to a restaurant license. Therefore, while the holder of a restaurant liquor license may choose to take a different approach, it does so at its own risk.” Thus, when given the opportunity to rule that it was legal, the Board gracefully decline to do so.

The Supreme Court left little doubt as to how it would rule regarding an “R” license,
“The Code, when examined as a whole, reveals a legislative scheme whereby the privileges of retail dispensers are ‘dovetailed’ with those of distributors, thereby allowing each type of licensee to occupy its own “niche” in the beer market.  Construing the definition of retail dispenser so as to permit the sale of beer solely for takeout purposes disrupts this statutory beer distribution scheme.”

To construe the Supreme Court’s language to include “E” licenses and not “R” licenses is to accuse them of being very loose in the language of an opinion. The term “retail dispenser”, which the court used, is defined in The Liquor Code, as “any person licensed to engage in the retail sale of malt or brewed beverages for consumption on the premises of such licensee, with the privilege of selling malt or brewed beverages in quantities not in excess of one hundred ninety-two fluid ounces in a single sale to one person, to be carried from the premises by the purchaser thereof.” We think it is fair to presume that the Court knows the law.

An “R” license, without the requirement of having on-premises sales and with the ability to operate with an Expanded Wine Permit, becomes the hottest item in the niche market for selling takeout beer.

Question is this: If Sheetz is turned down, as they should be by the LCB, will they play fair with Logan Township and go back so the supervisors can reconsider their municipal transfer?