Greensboro restaurateur can’t sell own microbrew at restaurants

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GREENSBORO, N.C. — A Greensboro business owner who was planning to open a microbrewery in June says he can’t get permits to sell the beer in his restaurants.

Marty Kotis tells FOX8 the Pig Pounder Brewery has been in the works for two years. When they recently went to finalize permits, the NC Alcoholic Beverage Control Commission could not issue the paperwork.

“We’re scheduled to open the Pig Pounder the first week of June, and right now we can’t get a permit,” Kotis said simply.

ABC Commission Director of Public Affairs Agnes Stevens said the law dates back to post-prohibition. The goal was to prevent big alcohol manufacturers from becoming corrupt or forcing retailers to only sell certain alcoholic brands and products.

She said the state formed what’s called a three tier system of permitting. “The manufacturers are separate from the wholesalers, and the wholesalers are separate from the retailers,” Stevens explained.

And generally speaking, a business person can’t have permits across tiers in order to prevent financial conflicts of interest.

There are exceptions.

Stevens explained, “If the brewery had been established first, as long as its production remains small enough, it can hold up to three retail permits and self-distribute its own product.”

But because Kotis already owns restaurants, Stevens said it is a different situation according to the law 18B-1116 entitled “Exclusive outlets prohibited.”

Kotis said he was given two options. “One option is to agree not to sell any of our beer in any of our restaurants ever. However, we could sell it other places. And to do that we would have to have a special exemption from the ABC Commission,” he said.

“The other option would be to transfer our assets over from the other companies, the other restaurant companies, into one entity and we would have to limit ourselves to only three restaurants plus the brewery.”

That would mean closing YoDaddy Desert bar in Greensboro, he said.

“It makes no sense at all,” Kotis added. “The three tier system was designed to protect and encourage free trade. This is the opposite of that… it’s trying to protect against an abuse and in turn creating an abuse.”

Right now they can’t sell the Pig Pounder beer in his restaurants or in the brewery itself.

Kotis pointed out he plans to sell other beer brands in the restaurants, too, not just Pig Pounder.

He said they would be forced to take future plans for restaurant and brewery endeavors outside the state if they can’t resolve this issue.

Two different attorneys FOX8 talked to Tuesday believed Kotis could get an exemption if he continues working with the ABC Commission.

Erik Myers, President of the NC Craft Brewers Guild who runs Mystery Brewing Company, agreed there had to be some wiggle room.

Stevens said the ABC Commission staff is working to figure out what would be the best options for Kotis.

Representative Jon Hardister told FOX8 he would try to address this issue legislatively.

Jamie Bartholomaus, President of Foothills Brewing in Winston-Salem said he wished Pig Pounder luck and hopes they open soon. Foothills sells its own beer in its one restaurant.

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