Governor Cuomo has vetoed Assembly Bill 5920A, the closely watched legislation that would have limited the New York State Liquor Authority’s power to punish licensees for their conduct outside the State. In his veto message, he stated that the bill would have fostered lawlessness among retailers and made the state a haven for those who engage in illicit sales. The Governor reasoned:
This bill would allow SLA licensees to use their New York licenses to illegally access other states' markets and knowingly sell their products in violation of other states' laws—all without fear of reprisal unless the other state successfully prosecuted the offense. It is unlikely that a scofflaw New York retailer would consent to another state's jurisdiction, thus leaving both SLA and the other state unable to take any action. Moreover, the longstanding provision in the ABCL that prevents manufacturers and retailers from having interests in each other would be rendered meaningless as long as such interests were held outside of New York. For these reasons, I am constrained to veto this bill.
The Governor has also directed NYSLA to conduct a series of roundtable discussions beginning March 1, 2016, "with industry representatives, interested stakeholders, and advocates to review and suggest changes to the law," as well as to work with other state liquor authorities to develop a legal framework for interstate sales. The beverage alcohol industry is in for an exciting year!
For background the on the ongoing legal dispute that prompted this legislation, click the “Empire Wine” tag below.