Beer Store Backlash Continues in Ontario with Lawsuits and Government Warnings
On January 15, 2015 At 1:00 pm
Responses : Comments are off for this post
TORONTO, ON – The controversy surrounding Ontario’s Beer Store – the retail beer chain co-owned by Molson Coors, Labatt/AB-InBev and Sleeman/Sapporo – has continued to build this week, with further skepticism from the province’s craft breweries, multiple legal threats, and indications that the Ontario Government is planning changes to the province’s beer retailing system all adding to the growing storm.
On Monday, the Ontario Craft Brewers released a second response to the Beer Store’s offer last week to allow all Ontario breweries to buy ownership shares in the company. Reiterating points made the original response, OCB chair Cam Heaps said that the organization is “looking for fairness in access and treatment for Ontario Craft Breweries and we want to bring Ontario craft beer out from behind the wall at The Beer Store.”
The statement also indicates that the OCB will be “continuing to work with [the government] on a beneficial outcome to this process,” and provides clarification around a 2011 letter that the Beer Store claimed to be proof of the OCB requesting ownership for its members.
On the legal ledger, two lawsuits have been brought forth against the Beer Store, with one also targeting the LCBO. The first to be filed was a class action lawsuit that was initially announced in December following a Toronto Star exposé about a “sweetheart deal” between the Beer Store and the LCBO. Spearheaded by Burlington pub owner David Hughes, the $1.4 billion suit was officially filed on Monday and will be going ahead in Ontario Superior Court.
At the same time, a 60 day notice of intent to file suit has been issued by lawyer Michael Hassell on behalf of Barge Craft Beer Distribution, a proposed beer retailer that he co-owns. If filed in mid-March as planned, the suit will request that the Court “invalidate subsection 3(e) of the Liquor Control Act, which grants The Beer Store monopoly powers,” allowing Barge and other independent beer retailers to open and operate in Ontario.
While a full and formal response to these issues has yet to come from the government, Finance Minister Charles Sousa told the Toronto Star yesterday that he is “going to proceed with redesigning and reassessing the Beer Store” in a way that will “maximize the benefits to consumers and protect the industry at the same time.” Changes to government legislation that oversees the Beer Store and how it operates are expected to be announced in March as part of the next provincial budget.