Comments Off on This is HUGE for Texas Craft Beer

This is HUGE for Texas Craft Beer. Absolutely huge. A great first step for breweries.

Live Oak Brewing Company

Austin, TX – It is with great elation that we join with all Texas Craft Breweries in celebrating the District Court of Travis County’s decision today to rule the unconstitutionality of TX SB 639, which expressly denied beer manufacturers from receiving compensation for one of their most valuable business assets: their distribution rights.

Chip McElroy, Co-founder and President of Live Oak, said “The Judge, Karin Crump, made a courageous decision in which she had to go against the will of the legislature, the TABC and the AG’s office to decide in our favor. It just goes to show the huge meritorious advantage our case had against theirs.”

“Besides relief,” Chip continued, “the biggest emotion I have right now is a feeling of vindication. All along I have been saying this was an injustice and the Institute of Justice did a tremendous job explaining that in legal terms. I’m not sure my rants would have carried the day.”

It is an acknowledgement of the value of something we have spent so many years building, and that the state has no right in choosing who wins and loses in the market.

We do not hate distributors, nor do we believe they provide no value. Distributors provide great value in their ability to create supply chain efficiencies, maintain quality and grow the value of brands. At Live Oak, we self-distribute in most of our territories and work alongside distributors every day to bring quality to our retailers and customers. The work is often thankless, backbreaking and very hard. Let their effort be recognized.

In turn, it is important to state that value does not exist in a vacuum; we must acknowledge that before every distributor, there is a brewery that has sacrificed like every other small business owner to create value and that value is what is often leveraged for further growth. This practice is not unique to our industry. It is an essential part of a mutually beneficial partnership.

We are not done yet: the defendants have 30 days to appeal. Thank you to our fellow Plaintiffs, the Institute for Justice and Texas Craft Brewers. In the meantime, we’re going to sit down for a round of beers. We hope all tiers will join us.

Final Judgement is available here:
For further reading: TX State Constitution:


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