Neighborhood liquor shops file lawsuit against Colorado, alleging that state licenses are biased towards large retail chains such as Costco, Walmart, and Target.

Four liquor stores in the Denver area have recently filed a lawsuit against the state, claiming that they are issuing an excessive number of liquor licenses to large, out-of-state grocery and big-box stores. The stores have taken legal action in hopes of having these licenses revoked.

The lawsuit, which was filed in Denver District Court, specifically targets "liquor-licensed drugstores" such as King Soopers, Costco, Walmart, and Target. According to the lawsuit, the state's Liquor Enforcement Division is not following a law that limits the number of liquor licenses for businesses with pharmacies to only eight.

One example mentioned in the lawsuit is the Vanguard Group, an investment firm that has ownership interest in 29 different liquor-licensed drugstores operated by various companies, including seven King Soopers and eight Costco stores. The law states that the cap on licenses applies to anyone who is a "part owner, shareholder, or person with a direct or indirect interest" in a liquor-licensed drugstore.

The lawsuit also mentions that the owner or someone with an interest in a retail liquor store can only have a maximum of two additional liquor store licenses. Steven Silvers, a spokesperson for the plaintiffs, stated that the state's Liquor Enforcement Division is illegally favoring large, out-of-state corporations like Kroger, Albertsons, and Amazon's Whole Foods while discriminating against smaller, privately owned Colorado liquor stores.

The four retail stores involved in the lawsuit are Applejack Wine & Spirits in Wheat Ridge, Heritage Wine and Liquor in Englewood, Bevy's Liquor World in Littleton, and Bevy's Liquor World in Parker. The Colorado Department of Revenue and the Liquor Enforcement Division, which is part of the revenue department, are also named in the lawsuit.

When asked for a comment on the pending litigation, Revenue Department spokesperson Elizabeth Kosar declined to do so. The lawsuit also claims that the state is not following a law that prohibits issuing liquor licenses to businesses with pharmacies if they have a stake in other alcohol-related industries such as restaurants, manufacturing, and distribution.

The retail stores decided to take legal action after their complaints were ignored by state officials. In an email, the Liquor Enforcement Division stated that they were looking into the allegations and would take appropriate action based on their findings. However, the stores' attorney, John Crisham, sent a follow-up email requesting a formal response from division director Michelle Stone-Principato by December 16th. The retail stores are asking the state to revoke the licenses they believe were issued illegally.

Crisham expressed concern over the state's failure to enforce the provisions of the Liquor Code outlined in their petition, stating that it is negatively impacting his clients' businesses, especially during the holiday season. To stay updated on business news, sign up for our Economy Now newsletter.

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