NEW YORK’S BIG EIGHT TO PAY $1.6ML

New York State’s four largest wine and spirits wholesalers – Eber Bros., Peerless Importers, Charmer Industries, and Southern Wine & Spirits of New York along with their affiliates Eber-NDC, Colony Liquor and Wine Distributors, Service Universal Distributors and Southern Wine & Spirits of Upstate New York – have agreed to pay $1.6 million and adopt a series of reforms after attorney general Eliot Spitzer and state liquor authority chairman Daniel Boyle uncovered “illegal marketing practices.” The attorney general claims that New York’s major wholesalers were in violation of the state’s Alcoholic Beverage in Control Law, which prohibits manufacturers and wholesalers of wine and spirits from favoring select retailers and on-premise outlets with discounts, rebates, allowances, free goods and other inducements.

The investigation claims that wholesalers gave discounts to favored retailers, along with gifts such as AMEX gift cards, free trips, iPods, golf clubs and gas grills. In some cases, wholesalers provided free cases of wine and spirits if the retailer was willing to buy certain products in certain amounts.

Each of wholesalers that were charged has agreed to file an affidavit with the Attorney General’s office within 60 days asserting the halting of illegal inducements and compliance with new regulations.