Missouri consumers can learn about sales and discounts on beer, wine, and other alcoholic beverages — and Missouri retailers can get out the word about their sales and discounts — after a recent federal court ruling.
Thompson Coburn attorneys Mark Sableman and Michael Nepple obtained the June 28 ruling for the Missouri Broadcasters Association (MBA). The decision, which overturned a state ban on such speech, is based on federal constitutional principles that prohibit states from outlawing truthful media advertising, except in special circumstances.
Dissemination of truthful information, particularly as to prices, drives the free market system, so it is rare for price advertising to be prohibited. Yet until this ruling, Missouri law did just that with respect to alcoholic beverages. If consumers wanted to find the best prices on their drinks of choice, they had to physically check prices store to store. And businesses couldn’t use radio or TV commercials to communicate new sales and discounts.
MBA and its co-plaintiffs filed suit over the issue in 2013 in the U.S. District Court for the Western District of Missouri, Central Division. Before bringing the action, they sought the Missouri Attorney General's voluntary compliance with the federal constitutional standards.
During the course of the case, the state of Missouri defended its advertising restrictions, claiming that they prevented binge drinking. But MBA presented evidence from multiple witnesses, including a professor who has studied the issue for 30 years, that showed advertising affects brand selection, not overall consumption. In fact, per capita alcoholic beverage consumption has declined even as advertising expenditures have increased fourfold. Moreover, Missouri allows bars to promote discounts available within their premises, which is far more likely to influence overconsumption than media advertising.
MBA and its co-plaintiffs challenged three different state laws restricting truthful alcoholic beverage advertising. In addition to the ban on discount price advertising, they challenged a ban on advertising of below-cost prices, and restrictions on manufacturer or distributor financial support of retail advertising. The court found overwhelming evidence that all three of the challenged laws were unconstitutional.
Mark Gordon, president of MBA, said the decision is helpful for bars, restaurants, liquor stores and other retail alcohol sales venues, which can now place commercial advertising that features actual discounted prices without needing to use code words to indicate discounts, such as “happy hour” or “ladies’ night.”
Thompson Coburn partner Mark Sableman said the decision was gratifying to the Thompson Coburn team and its clients. “It vindicates the position held by MBA and its members for many years: Truthful information about alcohol prices should not be barred from the media,” he said.
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