WSJ editorial board slams New Jersey restrictions on microbreweries

The Wall Street Journal editorial board has thrown its support behind Pacific Legal Foundation client Chuck Garrity, owner of Death of the Fox Brewing Company, who is suing the New Jersey Division of Alcohol Beverage Control over its restrictions on breweries. 

In a biting editorial, the Journal recounts some of the arbitrary and burdensome rules that have throttled Chuck’s otherwise-thriving business: 

Breweries can’t “collaborate or coordinate with any food vendor, including food trucks.” They can’t sell soda unless it’s made in-house. Happy hours are prohibited. Breweries can sell their own swag but can’t host “‘pop-up’ shops, bazaars or craft shows.” 

Each year breweries can advertise no more than 25 trivia nights, yoga classes, “paint and sip” sessions, or other similar “special events.” If a brewery hosts a band or airs any “live-televised championship sporting event,” such as the Olympics or the Super Bowl, that automatically counts against its 25 allotted events, even if it isn’t advertised. Oh, and breweries can have “no more than two television screens,” no bigger than 65 inches “from corner to corner.” 

New Jersey issued these regulations in 2019 but only started enforcing them this summer—and they’ve had “a huge financial impact” on Death of the Fox Brewing, as Chuck told The Wall Street Journal. What’s the state’s justification for the bizarre rules? The Journal has it right: 

New Jersey caps the number of liquor licenses for bars and restaurants, and a permission slip to serve booze can sell for as much as $1 million. Breweries are regulated separately as manufacturers. Republican state Sen. Michael Testa says the Division of Alcoholic Beverage Control has been “captured” by bars and restaurants that “see breweries as a threat.” 

In other words, the state agency is trying to prevent breweries from competing with businesses that have paid hefty prices for state liquor licenses.  

Not only are New Jersey’s restrictions a blow to economic liberty, but they’re also in violation of regulatory procedure: As PLF attorneys explained when the suit was filed, New Jersey failed to follow the proper process when issuing these protectionist rules.  

“State law requires that when an agency wants to impose rules affecting our lives and our livelihood, we must at least have an opportunity to voice our concerns,” attorney Luke Wake said. “And agencies are required to submit regulations to the legislature—which can decide whether to override this sort of agency action.” In this case, the ABC division never gave the legislature or public a chance to weigh in.   

The Wall Street Journal editorial board gives “credit to Messrs. Garrity and Testa for trying to allow more competition.” The Journal’s audience seems wholeheartedly to agree: The editorial has over 300 comments slamming the state agency and supporting Chuck. One commenter notes she’s been to Death of the Fox many times and calls the business concept—a combination microbrewery/coffeehouse—“genius” and the drinks “outstanding.” 

“If you’re down in South Jersey, give them a visit,” she urges.