D.C. Brewery Sues Government, Alleges Shutdown Could Destroy Its Business

D.C.-based brewery Atlas Brew Works filed a lawsuit against the federal government this week, arguing that a failure to approve labels on kegs of craft beer equates to an attack on its right to free speech. DCist first reported news of the suit, which Atlas filed against acting U.S. Attorney General Matthew G. Whitaker this past Tuesday.

In a court filing obtained by Eater, Atlas says it is sitting on 40 barrels worth of perishable, apricot-infused India pale ale called the Precious One that it wants to sell across state lines. The Alcohol and Tobacco Tax and Trade Bureau, a part of the Treasury, has stopped approving beer labels during a partial government shutdown that reached its record-extending 27th day today.

Atlas estimates that by letting the Precious One go bad, it could lose $15,000 over a planned 100-barrel run and could ultimately lose its whole business due to a domino effect on the rest of production.

Federal law prohibits the company from shipping kegs of beer with unapproved labels across state lines. Atlas is seeking injunctions that would stop the government from enforcing that law, effectively allowing it to resume its interstate business without getting the labels approved. According to its filing, Atlas uses five out-of-state distributors across Maryland, Virginia, and Tennessee.

Represented by attorney Alan Gura, Atlas Brew Works is arguing that it communicates with customers through its labels. By deeming the non-inspected labels illegal, Atlas argues, the government is preventing the brewery from exercising its First Amendment rights. The first line in the brewery’s filing reads: “The First Amendment never ‘shuts down.’”

Gura notably represented Maryland’s Flying Dog Brewery during a different type of free speech case in 2015, leading to a court victory over the liquor board in Michigan that affirmed its right to sell its Raging Bitch IPA in the state.

Atlas got labels on cans of the Precious One approved before the shutdown went into effect on December 22. But the government did not get to applications on its “keg collars” before the shutdown. Atlas listed an application date of December 20 for the kegs in its filing.

• Saddled With Beer It Can’t Sell During Shutdown, Atlas Brew Works Sues Government [DCist]