Michigan Cracks Down On Unlawful Alcohol Sales
 
June 1, 2000
 

Retailers and direct shippers beware - the Michigan Liquor Control Commission (MLCC), an agency with the Michigan Department of Consumer and Industry Services, has increased its efforts to prosecute retailers engaging in the unlawful sale of alcohol to minors and to prosecute direct shippers.

In 1999, approximately 35% of all alcohol violations in Michigan were related to the sale of alcohol to minors.  The Michigan Attorney General’s office, with the cooperation of the MLCC, hopes to reduce those numbers.  Earlier this year, the Michigan Attorney General’s Office and MLCC conducted a joint, online sting operation.  As a result of the operation, the Attorney General’s office filed criminal charges against two alcohol retailers in Illinois who sold and shipped alcohol to a minor without asking the minor’s age or requiring proof of identification.  “Notices of Intended Action” also have been issued to four other online businesses (three based in Illinois, and one based in California) for the alleged sale and shipment of alcohol into Michigan without a proper Michigan license.

In connection with the same sting, the Michigan Attorney General’s office also helped facilitate an agreement with United Parcel Service (UPS) regarding delivery of alcohol into Michigan.  On February 10, 2000, UPS became the first shipping company to enter an assurance of discontinuance with the Michigan Attorney General’s office.

 

UPS was represented in this matter by Holland & Knight.  The agreement the Attorney General’s office and UPS reached had seven components:

UPS agreed not to ship alcohol into Michigan and agreed to notify its customers who are alcohol shippers that it would not ship alcohol into Michigan.

UPS agreed to advise its customers that attempts to ship illegally into Michigan using UPS may result in termination of its shipping contract with the customer. 

If UPS identified that a package being shipped to Michigan contains alcohol, it agreed to advise the shipper that UPS does not ship alcohol into Michigan.  UPS also agreed to provide the package to the MLCC and advise the shipper that it was providing notice of the attempted shipment to the Attorney General’s office.

UPS agreed to train or re-train employees who handle shipments regarding the policy against alcohol shipments into Michigan.

UPS agreed it would terminate its shipping contract with any customer criminally convicted by the Attorney General of illegal alcohol shipments into Michigan.  UPS also agreed to terminate its shipping contract with a customer if the Attorney General provided sufficient evidence that the customer had made one or more illegal shipments of alcohol into Michigan after being directly notified by the Attorney General, the MLCC, or UPS, that such shipments are illegal.

UPS agreed that any alcohol shipment that can be made legally within Michigan by properly licensed retailers would only be delivered by UPS to a person 21 years of age or over.

UPS agreed to pay $5,000 in investigative costs to the State of Michigan.

Retailers should keep in mind that there are certain conditions under which they can legally sell alcohol over the Internet without violating Michigan’s direct shipping laws.  For more information about the proper procedure required for Internet sales, parties can contact Ken Wozniak, the MLCC Legislative Liaison, at (517) 322-1390.  Alternatively, those interested in Internet sales of alcohol can contact Richard M. Blau, the head of Holland & Knight’s Beverage Alcohol Practice Area.  Mr. Blau can be reached at 1 (888) 688-8500 or rblau@hklaw.com.