Monarch Beverage owners can sell liquor, judge rules

A judge on Wednesday ordered Indiana's licensing board to allow the owners of beer and wine wholesaler Monarch Beverage to also sell liquor through a separate company.

Marion Superior Judge Heather Welch on Wednesday ordered the Indiana Alcohol and Tobacco Commission to grant a liquor license to Spirited Sales, a company owned by the same people who own Monarch, the state's largest beer and wine distributor.

"I think the judge draws the right legal conclusions from those facts and the past practices of the ATC," said Phil Terry, the chief executive officer of Monarch and Spirited Sales.

The ATC and the Attorney General's office are reviewing Welch's ruling and considering an appeal, Indiana Excise Police spokeswoman Heather Lynch told IndyStar in an email.

Lynch declined further comment, noting "all avenues of appeal remain open and under consideration."

In a 52-page order, the judge ruled that the ATC "acted in an arbitrary and capricious manner" when it denied Spirited Sales'  wholesale liquor permit last year.

Welch's ruling cites special privileges the ATC gave to  Spirited Sales'  would-be competitors during the licensing hearings.

Two trade associations representing liquor sellers, Wine & Spirits and the Indiana Beverage Alliance, were allowed to cross-examine witnesses, raise objections and make closing arguments "as if they were parties to the proceedings," Welch wrote.

Welch noted the ATC has granted licenses to at least 11 other companies with similar ownership circumstances.

Indiana is the only state that does not allow wholesalers to distribute both beer and alcohol. In the order, Welch cites the growing popularity of craft beer and noted that the "landscape of alcohol sales is radically different" than when the rules were drafted in 1973.

Monarch has been fighting, and losing, in court to change the law for several years.

In December, the Indiana Court of Appeals ruled against Monarch's request to sell both beer and liquor.

The new court decision gives Monarch's owners an important legal victory, Terry said.

"We think the ATC's decision was wrong," Terry said. "It was about protecting competitors, not about protecting the people."

Call IndyStar reporter Vic Ryckaert at (317) 444-2701. Follow him on Twitter:@vicryc.

Appeals court: Monarch Beverage can't sell both beer, liquor