Tennessee Alcoholic Beverage Commission Investigation Results in Fines and Injunction Against Retailers Illegally Shipping to Consumers in Tennessee

After several years of investigations, the Tennessee Alcoholic Beverage Commission (TABC) announced a court-approved settlement that includes injunctive relief and over $50,000 in civil penalties levied against five online liquor stores unlawfully shipping alcohol direct to consumers without proper licensing.

Executive Director Russell Thomas issued a strong warning against illegal shippers: “These penalties mark a significant step in our efforts to halt illegal online alcohol distribution and ensure compliance with legal and safety standards. Businesses selling alcohol without a license in Tennessee should expect severe penalties.” The enforcement indicates a strong willingness from the TABC to aggressively prosecute those seeking to skirt the lawful distribution of alcohol in Tennessee.

TABC Special Agents purchased distilled spirits from each of the defendants. After cease and desist letters went unanswered or ignored, the defendants continued to illegally ship distilled spirits direct to consumers in the state. Attorney General Jonathan Skrmetti filed suit under the Twenty-First Amendment Enforcement Act and the Tennessee Consumer Protection Act and the business ultimately agreed to pay penalties totaling $58,320, cease illegal shipping, and acknowledge their violations.

While previously working as counsel to the TABC, BSH Associate Ryan A.T. Mercurio was a critical part of these investigations, having coordinated operations with law enforcement, and communicated with the defendants on behalf of the TABC. 

This case is the first successful prosecution in Tennessee using the Twenty-First Amendment Enforcement Act, which allows state attorneys general to seek injunctive relief against entities and individuals which violate state alcohol law. The only other prosecutions all happen to have occurred in the Sixth Circuit, including Michigan and Ohio.

BSH is well-versed in the compliant licensing of Winery Direct Shippers, Wholesalers, and Non-Resident Sellers, in Tennessee and throughout the Southeast.

The Consent Decree can be read here.

Last modified: June 4, 2024