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Missourians Have a Right to Know Just How Cheap the Drinks Are, 8th Circuit Says

Friends raising their glasses in a toast
By Laura Temme, Esq. on February 06, 2020 12:35 PM

Missouri residents will soon have a much easier time finding the best happy hour deals, thanks to a recent decision in the Eighth Circuit. State law barred restaurants and bars from advertising discounted rates for alcohol, including through specials and coupons. They could advertise that they had a happy hour or other specials, but could not go into any detail about pricing. The Missouri Broadcasters Association, along with three other plaintiffs, filed a First Amendment claim in federal court in 2013.

How Much Can the States Control Alcohol Advertising?

Missouri presented a two-fold argument: First, it argued that it had a compelling interest in limiting this kind of advertising because it could encourage underage drinking. Second, the state claimed its law followed the "tied-house" laws of other states.

Tied-house laws create a legal separation between alcohol manufacturers, distributors, and retailers by preventing each from having a financial interest in the others. And while Missouri's Liquor Control Law does follow many other tied-house regulations, its "Discount Regulation" prohibited retailers from advertising discounted prices outside of their establishments. Advertisements inside the bar or restaurant, on the other hand, were fair game.

The state argued that the statute, through "consensus and history," advanced its interests, and the 21st Amendment granted it authority to regulate alcohol advertising.

History Won't Help You Here

However, the Eighth Circuit panel disagreed - affirming the lower court's ruling against the ban. Although the state argued that, historically, tied-house laws prevent alcohol producers and distributors from having undue influence over retailers, the court found that failed to justify the Discount Regulation.

"Missouri's reliance on history is misplaced, because it discusses the history of other states and the purpose behind tied-house laws generally, but fails to include a discussion of Missouri's own history or of the statute in particular," wrote U.S. Circuit Judge Jane Kelly. Moreover, in practice, the statute restricted speech based on content and the identity of the speaker.

A similar law was overturned last summer in Virginia, where legal action by restaurateurs pushed lawmakers to pass new legislation loosening the restrictions on advertising.

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