Monday, March 6, 2017

Law Banning Truthful Advertising on Booze Sales Comes Under Fire in Missouri

Posted By on Mon, Mar 6, 2017 at 6:50 AM

click to enlarge SHUTTERSTOCK/MARTINS PORMANIS
  • SHUTTERSTOCK/Martins Pormanis
Under Missouri state law, it is illegal for retailers to advertise what they're charging for booze if the state deems it too cheap. A store can tell you they have, say, Smirnoff on sale. But if they've paid their distributor $19.99 per bottle, they can't tell you in an ad or a mailer that it's on sale for $18.99. If they're selling spirits below cost, the law requires them to zip their lips.

Under Missouri law, it is also illegal for alcohol stores to offer coupons, rebates or loyalty clubs. Those cards that let grocers offer discounts in exchange for the ability to track your purchases (and inundate you with in-store coupons)? In Missouri, they're illegal for alcohol-based retailers.

These long-held restrictions, however, are now coming under fire in Missouri. A federal lawsuit challenging the advertising restrictions on free speech grounds won a major victory in appellate court in January. And a bill in the Missouri House of Representatives seeking to eliminate other restrictions got a public hearing last week. As proposed by state Rep. Robert Cornejo (R-St. Peters), the bill would allow retailers to offer coupons, rebates and other promotional programs.

The current law's future may come down to one question: Does Missouri have a compelling reason to restrict free speech by alcohol retailers in these particular ways? The state argues that it has an interest in promoting "responsible drinking." But the people challenging the law — which include the Missouri Broadcasters Association and a St. Joseph sports bar and grill — say the state's unique restrictions do little to ensure that's happening.

In its January decision, the U.S. District Court for the 8th circuit agreed, noting, "A theoretical increase in demand for alcohol based on a lower price does not necessarily mean any consumption of that alcohol is irresponsible." In other words, I may buy more Smirnoff if my local liquor stores tells me it's on deep discount — but that doesn't necessarily mean I'll drink it any faster.

The judges also note that the law is remarkably inconsistent: It allows retailers to charge below-cost prices — and allows them to display those prices within their stores. "Defendants assert the challenged regulations prevent retailers from luring vulnerable consumers to their places of business, yet defendants apparently are not as concerned with retailers baiting consumers to drink excessively once they arrive," the judges write.

The efforts to overturn the law have won the support of Total Wine & More, a family-owned Maryland-based chain that recently opened three St. Louis-area locations. Edward Cooper, the company's vice president of public affairs, says his company operates in 20 states — and had never seen anything like the Missouri restrictions.

"It made our heads spin," he says. "How do customers differentiate between stores and figure out where they want to shop when they're not getting the right pricing information?" Retail ads in Missouri will use language like, "Come in to find our best pricing" — something that he says simply makes no sense for a company like his, which seeks to attract customers based on the lowest prices. These days, he says, "the consumer expects to know what the price is when they go shopping."

The effort to roll back the laws is expected to continue on two tracks — now that the appeals court has said that the lawsuit challenging the restrictions can continue, the Missouri Broadcasters Association and its allies will fight their case in federal court. And Cornejo's bill has already made it through two hearings — though it has drawn some criticism from alcohol retailers who like things just fine the way they are (that includes a group of c-stores and St. Louis' beloved Randall's, among others).

"They were asked over and over, 'Exactly why do you want this?'" Cooper recalls. "They said they want a 'level playing field,'" intimating that big retailers like Total Wine & More would have the advantage if they were allowed to advertise their prices. But to Cooper's mind, truthful advertising should be the ultimate leveler. "What's wrong with transparency in pricing?"

We welcome tips and feedback. Email the author at sarah.fenske@riverfronttimes.com


Best Things to Do In St. Louis

Newsletters

Never miss a beat

Sign Up Now

Subscribe now to get the latest news delivered right to your inbox.

© 2017 Riverfront Times

Website powered by Foundation