The Philly Beer Raid Debacle, discussed at Memphis Taproom

Reason.TV put up an interview on YouTube that you might find interesting in the continuing discussion of what happened back in March at Brendan Hartranft's and Leigh Maida's bars in Philadelphia. If you've been following the saga, there may not be much new for you in here...but it's an interesting first-person interview nonetheless.

Wanna know One More Thing about The List?

1 More Thing? How about when The List doesn't change---not one period, one misspelling, or one umlaut---the date at the top of the webpage still changes. Either automagically or by human hands I'm not sure. That's the case between yesterday and today.

See, I've got a little process that I put together that compares the list every day and identifies additions, deletions, and changes. Through yesterday, since last Monday there have been 135 additions and 9 changes to the list. Between yesterday and today, not one single change; yet the date could lead you to believe otherwise.

Maybe I'm the only one that thought that if the date changed, that implied that something in the list changed. I've heard people refer to the integrity of the list before something along the lines of "the list is kept up-to-date because there's a current date at the top." So, maybe I'm not the only one who might have been a bit misled.

I realize that it's a "registered brands...as of MMM DD, YYYY..." list, but still. Oh, on similar topic, I wonder if the Nugget NectOr kicked at The Drafting Room yet? (that was NOT a typo, just check The List and you'll see what I mean)

You didn't think I could get through the weekend without more mention of this Great Fiasco, now did you?! There was just way too much chatter during Philly Beer Week(end) to not have something yet more to say. Back to your regular programming.

Closing Thoughts for what has been an Exhausting Week

It's been a busy week of Talking About Beer, how it gets distributed and how it is sold in PA...now it's time to step back and drink a few during this thing called Philly Beer Week(end)

I've worked in several capacities in the industry of banking and finance, regulatory as well, in my career. Long enough to be able to ask the questions of why and how. Long enough to never have received good answers. Perhaps because most people I'd asked were too entrenched and too busy profiting from their aggressive and irresponsible greed. And the regulators? Always too willing to back down and turn a blind eye. These last couple of years, we've seen the fruits of this recklessness and laziness come home to roost. I should stop; this isn't a forum where my day job should cross over in to.

But, there is a parallel in the story that's begun to unfold here in Philly over the past week.(I like the chronology that BeerNews.org put together...though, I want to go on the record as not being the one spreading speculation that this was all due to Pliny the Younger haves and have-nots.) From retailers to wholesalers to suppliers, many organizations are profiting from the continuing growth within the craft segment of the beer industry. More shortcuts have been taken as time goes by in an effort to get product to market as quickly as possible and to get the biggest share of the pie along the way. Some of these shortcuts are conscious decisions and others are unconscious. Some of these are educated gambles, whereby those involved hope not to get caught, based on the historical prosecution of law offenders (read: lack thereof).

This week in Pennsylvania, some of this was exposed (if this is the first you're hearing of this, you may wish to go back here and catch up). Publicans who are taking product, sometimes on the word of the wholesalers, that may or may not be legit in the eyes of the law and turning it around as quickly as possible to demanding customers (i.e. the ravenous beer geeks). While these guys are some of the last in line that I'll refrain from focusing too much blame on in this fiasco, they do bear at least a bit of responsibility for knowing whether product is legally available for sale in the State or not. I'm not talking 'Duvel' versus 'Duvel Golden Belgian'. More like, are Goose Island or Captain Lawrence, the manufacturing breweries registered...period? Have they ever been? Are they even in the process of gaining registration?

So we take it up a level to the wholesalers...remember, keep following the money. The wholesalers, as liaisons between suppliers and retailers, should bear much more of the responsibility here than the retailers. Even if it is ultimately falling on the brewery/supplier to do the actual registration and fee payment, the wholesalers that are bringing the product into state and ultimately distributing it should know exactly what's been registered and what has not. When it's not, through their contractual relationships with breweries/suppliers, I believe it's incumbant upon them to carry out, if nothing else, an ethical responsibility to ensure that the products of the breweries/suppliers are on the up-and-up.

Take, for example, Vinnie Cilurzo's statement of "...being a mom-and-pop organization...some things slip through the cracks..." That's understandable, of course. But, where was the wholesaler to say something to the effect of "...we notice that this one or that one are not registered with the State...is that true? or is it a clerical oversight at the State?..." Breweries only have X number of brands to manage (across many states, understandably...but still, just X brands). I like Scott Smith's (East End Brewery, Pittsburgh) statement earlier this week where he said, and I'm paraphrasing here without going back to double-check: "...I make a lot of brands...often in small quantities...when I ship them out, I have a form to fill out and a $75 check to write...I send it in...it might be a pain, but it's really not a big deal..." Still, wouldn't it be nice to know your wholesaler/distributor has your back in case you forget?

And then we follow the money in a different direction...to the government. They want their cut too. In our Control State that is Pennsylvanis, and likely always will be, this is how it works. They get sales tax at the end of the cycle, but they also get application/registration fees upfront too. Basically, it amounts to an administrative fee for allowing a brewery's product (each individual brand name, in PA...another point of valid argument) to be brought into the State and then getting listed on their Holy Grail of a Registered Brands List.

Ah, and if I haven't made any points yet throughout this thing (I don't know, what do we call this thing today? A Diatribe? A Rambling Diatribe?), here's my Point.

This List that we speak of? This is the List that I referred to last week as "...I have never put 100% faith in...the website source for licensed brand registration in Pennsylvania...never put confidence that...getting it right on every line of roughly 3000 beers."

Today, we learn from the intrepid Joe Sixpack---after he clicked on the Privacy Policy link at the bottom of the PLCB's webpage---that regarding this List, the PLCB's position is that it can not be relied upon and should not be used for legal enforcement purposes. Unfortunately, this does not surprise me. This List turns out to be just a list...one that is processed and maintained by human eyes and fingers, and subject to whatever degree of accuracy that PLCB management deems sufficient.

Now don't get me wrong. I'm as sympathetic as the next when it comes to entry- or barely entry-level data clerks. There's not much motivation to get things 100% correct. But, where's the management in this picture? When things break down in a system as they have in this case, it's easy to point to this small part of the system or that one that isn't/wasn't working as well as possible.

Often times, though---take for example "scandals" in the military, religion, the school system, etc. (how's that for 3 big ones?!)---it's much more useful to begin from the top. Go up the chain and hold those accountable for defining the system, running the system, and enforcing the system. Often times, as we follow the money again, it's those that stand to financially benefit the most from "the system."

Here in our story about the beer industry and the making and distributing of its product, we have Pennsylvania and around 20 other Control States. That means that the State is "in charge" of determining what can be sold and how it can be sold to consumers within its state lines. It means that it defines the rules (that they've now begun to admit may be outdated and ripe for change), it oversees the rules (with information, apparently as we're learning, that they are admitting can not be relied upon by any parties affected by it), and it enforces the rules (by police that appear to not have sufficient information or communication from the overseeing agency).

Lew, I think the case has been set up adequately to be presented to Harrisburg. Control State, if we must. 3-tier System, not going anywhere anytime soon I'm sure. At the risk of sounding like a broken record, though, The System is Broken and Must Be Fixed. We've learned, thank you, that the ball gets rolling April 13th. In what direction, how far, and how fast all remain to be seen.

The Story of the Year (to date) in Philadelphia

I take back what I said yesterday when I said that there was not much worthy chatter out there. Turns out most of us must have been enjoying the beautiful weather around the Philadelphia area. Since then, every one has settled back into their desk chairs (at home, or I'm presuming at work!!) and...

...our local ABC affiliate got in on the story during tonight's 6 o'clock newscast; though, I'm not so sure about the "cool and secured cellar" comment.

...Don Russell/Joe Sixpack has done some more of the investigative work that he's good at.

...Lew Bryson's blog about the inner- and never-workings of the PLCB and the associated posting on this topic has mushroomed to over 20 comments while...

...Jack Curtin's site seems to be the place to be heard. As of this afternoon, he's logged over 50 responses to his initial posting...including weigh-ins from Nancy Barton, Mark Haynie, Chris LaPierre, Leigh Maida, Steve Mashington, and Jeff Miller.

...and my posting from yesterday has accumulated a handful of quality comments.

...According to the Facebook event status for tonight's Exit 16 release party at McGillin's, it has been cancelled due to an abundance of caution.

The conversation is really rolling now; let's not let go of this. Unlike the evening news, I suspect that we'll be tracking this one for quite some time.

Shut up about your Pliny the Younger*

Well, Sunday morning is not as easy as I thought it might be here today. I'd caught wind of a still-unfolding story involving the city's Memphis Taproom, Local 44, and Resurrection Ale House beer bars at the beginning of this weekend. I thought "wow" at the time and wondered how big this might get.

I won't go as far as to say I saw this coming, but I saw something like this coming. Things have been relatively quiet, peaceful, and amicable for sometime now. It was only a matter of time as more consumers, retailers, wholesalers, and suppliers are vying for what they see as a piece of the lucrative pie that is non-industrial/macro beer.

Add to this gnawing feeling the growing awe and angst that I've felt around all of these ridiculously hyped beers...HopSlam, Pliny the Younger are just two beers that we could start the conversation with. Lest I sound like a hypocrite, if you read here closely enough you likely know that I have a case of Monk's Blood, of Nugget Nectar, a six-pack of HopSlam, and bottles of Consecration in my personal inventory. I like drinking the interesting stuff as much as anyone, but I will refuse to throw elbows for it...now, more than ever.

With all of this in mind, I'd been tossing around, for the past few weeks, the formulation of an article themed around the idea that the percentage of good guys (and ladies of course) in the work of "craft" beer has been dwindling. Not rapidly, mind you. And dwindling more at a glacial pace, and not the kind of global warming glacial pace, but I think you see what I mean. Don't get me wrong, there are still way, way more good guys at all levels of the business, but with more hands reaching for more money, something's bound to give.

From my first-hand (and sometimes first-and-a-half hand) experience and anecdotal evidence, Consumers want more beer...and the more rare, the more "exotic", the more we want it, right? From the other end, experienced talented Brewers/Suppliers and up-and-coming Brewers/Suppliers are battling to make beers that are the most interesting and demanded by the Consumers. And, they are making products that Consumers have never even dreamed they might want or like. Not that this is necessarily a bad thing.

But, in the frenzy to raise revenues and get their products out to and seen by an ever-widening and growing market of beer drinkers, Suppliers use Distributors to get their product to the Consumers. Wrapped around all of this is The Law. The Law written by legislators, overseen by an agency, and policed by a badge and gun. Most of whom I would challenge in their understanding, particularly, of the wide world of beer as we know it in regions like Philadelphia.

So how did this debacle at Memphis Taproom/Local 44/Resurrection Ale House get to this point? Only a few know 100% for certain. Some of the conjecture floating around attempts to center the discussion solely on Pliny the Younger and the inability for some to get it on their tap handles while the MT-44-RAH family of bars apparently have three. Fair? Unfair? I suppose that comes down to whether you like Brendan, Leigh, and what they are doing and have accomplished...or not.

And while I have a hard time getting my head around someone "ratting out" these folks for a keg or two of PtY, it may well have been the tipping point. Seriously? Would you risk your reputation on a $300 keg (or whatever PtY is costing bars nowadays)? Is the future of your bar really dependent upon getting a keg of PtY for a couple of hours? Is the hassle really worth it? I'm hearing more from folks on the retail end of things that the hassle of such things is getting less and less worth it....more on that to come.

What I'm increasingly more convinced of comes down to more of a conversation about envy. Jealousy of what these two have accomplished in a remarkable amount of time. (in case it's important to you, I should point out that I do not have a personal relationship with either Brendan or Leigh...simply a friendly professional one as a result of what I do here at The Brew Lounge.)

If you're the type of bar owner, though, that would do such a thing (and, yes, I'm going out on a limb without solid proof, that this was the anonymous tipster workings of a competing bar owner) then you fall into the category that I described earlier as a growing, albeit minority, people who do not have the best interests of the industry at heart. Are you not getting the beer geek cred/hype that you think you deserve? Then, I'd venture to suggest that you're not doing your job year-round to earn this. Getting a keg of PtY does not earn you a year-round reputation as a destination beer geek bar. And, do you really want the beer geeks? You know they can't sustain you year-round, right? You want a solid, diverse crowd. Once again, to risk completely alienating the beer geek crowd that you think you may want over a keg of PtY seems utterly foolish. That's why I'll continue to bring this back to a more personal and jealous angle of how/why this story is continuing to unfold.

Oh, The Law, in this case? Ha, I barely touched on their involvement in this. But, our friend Lew Bryson has done an admirable job of covering this area for quite some time now and has a well-construed synopsis of what has transpired this past week. Go and read it; it beats the heck of what I'm writing here.

The only two cents I would add on this topic, since I'm not sure it has been said letter for letter, is that before the PLCB and The Law go attempting to clean other's houses, they better make damn well sure that their's is first in order. That may be some interpretation of a parable, I'm not sure.

My point there is that I have never put 100% faith in what so many will adamantly point to as the website source for licensed brand registration in Pennsylvania. Is it what retailers and distributors should be able to point to with faith that the list is accurate?...sure! Even though there's a date at the top of the webpage, I've never put confidence that the fingers that type the entries on the list are getting it right on every line of roughly 3000 beers. Cynical? Perhaps. Reality in today's culture of less-than-concerned-with-100%-accuracy where all kids get a prize? Maybe.

From a Retailer's point-of-view, doing their homework, I believe, comes down to taking the PLCB's word (on their website) for what is registered and what is not. But, more importantly, working with the Distributor whose role it is to honor contracts as the prudent middleman between suppliers and retailers? At some point, retailers have to, I believe, fall back on what should be the distributor expertise in brand management for their market. Naive? Perhaps.

And, from the Supplier's perspective, it may sound like a lot to ask, particularly for smaller operations, but I firmly believe that breweries have to take responsibility for where their product winds up. I don't necessarily mean each retail account and the gray and black markets. Rather, I mean on a state-to-state, distributor-by-distributor, market-by-market basis. I believe that, once again as the market and brand "expert", the Distributors need to fill their role responsibly, but the brewery/Supplier needs to understand the State, its laws, etc. related to where their beer is sold. Thoroughly...inside and out. Sorry, it's just too important to neglect.

Finally, I urge you to become better versed in the distribution of alcohol. Don't take what I spill out here as anything close to gospel. I don't have the right answers and I surely have a lot to learn of my own. Though, I've yet to come across anyone who has all of the right answers and can speak definitively on these laws and the enforcement of them. There is way too much rumor-mongering and here-say taking place without much substantiation. This story is a complex one and one that deserves to be dealt with in fact and not supposition and half-truths.

Breathe....I said to myself that I would keep this to just a few paragraphs, but I had a difficult time sleeping last night and a lot becomes more clear during sleepless nights.

Agree? Disagree? I'm sure there are (and I have already been engaged in deep, lengthy, interesting, and thought-provoking discussions at Dock Street and TJs yesterday) many flavors of varied opinions on multiple sides of this complex story.

I don't know where this is all going, as I am surely no expert on the intricacies of beer distribution laws and politics. But, one can only wonder what this may portend for Philly Beer Week.

Oh, and maybe now's a good time to remind all to DRINK LOCAL...it's a bit less complicated.

* The title of this posting is loosely inspired by the well-formed title of a well-written blog: Shut Up About Barclay Perkins and can be construed in a few different ways as to what I really mean by it. And you could stand to be correct in each way.