Cuvee Coffee’s crowler is finally free from the clutches of the Texas Alcoholic Beverage Commission (TABC).
The 20-month saga between the Austin, Texas-based coffee company and the Texas regulatory agency finally concluded with the TABC returning Cuvee’s crowler canning machine, which it seized during a September 29, 2015, raid of the retail store.
Cuvee founder and CEO Mike McKim appealed to the state lawmakers, who supported the return of the machine, which finally came back to the company last week. McKim celebrated the news on Twitter:
Oh yeah, I forgot to mention that Texas retailers can now legally sell crowlers. Enjoy! #itsofficial #crowlerisfree pic.twitter.com/RX5IdYAsUF
— Mike McKim (@MikeMckim) March 29, 2017
In a conversation Thursday with Brewbound, McKim sounded relieved that the fight was finally over.
“It’s over man,” he said with a bit of a sigh. “It’s all over. The great news is now retailers in the entire state of Texas, if they have a BG license and can sell beer and wine for off-premise consumption; a crowler is now a vessel that they’re allowed to use.”
To refresh: Despite several rulings in favor of Cuvee, the TABC continued the fight to stifle the use of crowler machines, which seal 32 oz. cans of to-go beer. In November, a Texas administrative judge ruled in Cuvee’s favor and dissected the state’s claim that a crowler “jeopardizes the general welfare, health and safety of the people” because “beer in crowlers is not properly oxidized, organisms can get into the product.”
“It appears disingenuous for (TABC) Staff to assert crowlers are dangerous to the public, unless they are sold at brewpubs,” Texas administrative judge John Beeler wrote.
The case didn’t end there. The TABC fought on with the allegation that Cuvee was illegally manufacturing beer, filing exceptions in December, which were overruled earlier this year, and the case was seemingly over.
Except, the TABC still had Cuvee’s $3,000 crowler machine.
“I learned, which is crazy, they don’t have to accept the judge’s ruling, even though we went through the whole process,” McKim said.
And it became obvious to McKim that the state agency wasn’t going to return his property. So he reached out to the governor’s office as well as state Rep. Ramon Romero Jr., who has also introduced a bill attempting to legalize the machines. Enough pressure was put on the TABC that the state agency finally relented with executive director, Sherry Cook, signing an order on March 13, and the agency returning Cuvee’s crowler machine last week.
McKim estimated that Cuvee sold about 1,000 crowlers in the few months before his business’ machine was seized by authorities. In contrast, growler sales have been “fantastically unsuccessful” due to the cost ($12 for beer and $15 for a glass container), he said.
“In the past 20 months, we’ve done 16 growler fills,” McKim said. “There’s a huge difference, man.”
In light of the Cuvee raid, retailers such as Whole Foods and Central Market had their crowler machines removed.
“Hopefully they’ll put crowlers back in all of their locations,” McKim said. “They’re so much more economical. Unlike growlers, they give you an opportunity for an impulse buy.”
Fighting the state agency hasn’t been cheap. McKim said the battle with the TABC has cost him $41,300 in attorney costs and legal fees.
“The reality is the amount of revenue that we lost is probably about that or less than that,” McKim said. “The TABC said, ‘Why are you fighting this? It’s not like you’re getting rich.’ It was about the principle.”
And those costs won’t be coming back to Cuvee. Texas regulatory agencies are exempt from legal action to recoup legal fees in cases such as this one. However, McKim recently testified in favor of a Senate Bill 813, which would allow companies or individuals to recover damages, attorney’s fees and costs related to frivolous regulatory actions by a state agency
“It’s our case exactly,” McKim said. “We’re the poster child.”
The costs to McKim likely pale in comparison to what taxpayers shelled out for the action.
“They showed up with five lawyers the first day in court,” McKim said. “Those people are not getting paid minimum wage. I have to believe the hours they put into this and all of the attorney hours and all of that sort of stuff, I can’t even guess. Maybe hundreds of thousands of dollars, probably.”
Brewbound left a message with the TABC seeking the cost of its legal action. The agency has yet to reply as of press time.
Meanwhile, McKim is still struggling to unpack the whole ordeal.
“The more and you try to figure it out logically, the more your brain is going to hurt because it makes no sense to me at all,” McKim told Brewbound. “Someone is pulling their strings. There’s just no doubt in my mind that somebody is behind the scenes telling them you need to take care of this. The reason I say that is they changed their reason 12 times, literally 12 times, before landing on you’re illegal manufacturing.”
McKim said the TABC was constantly grasping for reasons to ban crowler machines, and he recalled seeing an email during the discovery process that showed TABC employees discussing how a big beer company wanted to get rid of growlers altogether under the guise of public health and safety.
“They want growlers gone because nobody is filling up growlers with their watered-down, crappy beer,” McKim said.
As McKim prepared to hang up, he told Brewbound that he was heading to Cuvee to hook up his crowler machine with plans to fill the 32 oz. cans on Friday.
“A lot of people have been fantastically supportive even though nobody wants to take on the TABC, especially if their livelihood is alcohol, people have offered to help out,” he said. “People have been championing us for quite a while. It’s been super cool.”