Attorney General's News Release

March 14, 2000

Judge denies appeal of Internet beer distributor that violated Missouri law

Jefferson City, Mo. — The Missouri Court of Appeals, Eastern District today affirmed the decision of a lower court that an Internet business based in North Carolina violated Missouri consumer protection laws and liquor control laws when it sold and delivered beer directly to an underage Missourian.

The court also rejected arguments by Beer Nuts Ltd., of Greensboro, that Missouri courts had no jurisdiction over its sales. The lower court ruling prohibited Beer Nuts from selling or delivering alcohol directly or indirectly to Missouri consumers and from selling memberships in any beer-of-the-month programs to Missourians unless the business complies with state statutes that govern the sale and delivery of liquor in the state.

The court said the 21st amendment to the U.S. Constitution gives each state the right to regulate the delivery and use of intoxicating liquor within its borders, and that by advertising and selling beer directly to Missouri consumers the company was subject to state liquor control laws. The court also affirmed that Beer Nuts violated state liquor control laws by selling beer to a minor and selling and delivering beer to Missourians without a state license. The company violated consumer protection laws by representing to consumers it could legally sell beer to Missourians.

"This case establishes once and for all that companies that do business over the Internet with Missourians are subject to Missouri consumer protection laws," Nixon said.

Attorney General Jay Nixon filed a civil lawsuit in July 1997 against Beer Nuts, which operates a site on the Internet under the name Hog's Head Beer Cellars. Nixon filed the lawsuit after Beer Nuts accepted a credit card order on its Web site from an 18-year-old intern. Nixon said that at no time did Hog's Head require the minor to prove, or even say, that she was 21 or older. The order was delivered to a St. Louis address with no instruction to restrict delivery to someone 21 or older. The package containing the beer was left on the doorstep with no one signing for it, Nixon said.

"The purpose of this lawsuit was not to hurt Internet commerce," Nixon said. "The purpose is to make sure that all businesses doing business with Missourians are obeying state laws that protect consumers."

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to Press Secretary John Fougere.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818