Wegmans and affiliated liquor stores face civil penalty of $1.1 million over licensing issues

Nov 21, 2018

The New York State Liquor Authority says that Wegmans and five affiliated liquor stores are facing a total of $1.1 million in civil penalties over some licensing issues.

The Liquor Authority says they received a complaint that a liquor store in Buffalo, “Amherst St Wines & Liquors,” was allowing Wegmans to effectively control their business by managing purchasing and pricing decisions. The Liquor Authority determined that Wegmans, which is not licensed to traffic in wine or spirits in New York State, was exercising significant control over that Buffalo store in addition to four other affiliated stores.

Those stores include Century Liquor & Wines in Pittsford, and Whitehouse Liquor & Wine in Henrietta.

The State Liquor Authority has accepted a settlement offer from Wegmans of $750,000. The five affiliated liquor stores were each fined $75,000.

As part of the settlement Wegmans appointed a new Corporate Compliance Officer and implemented a new program to prevent additional legal complications in the future.

Wegmans issued a statement pushing back against the state’s finding, saying that the supermarket chain categorically denies the assertion that the company exercises control over any liquor store in New York. The company says what the stores have in common is that each is individually owned by a Wegman family member, and the company says, “It’s unfortunate that the SLA chose to credit complaints from competitors of these liquor stores over the actual facts presented to them during the investigation.”

Wegmans went on to say that, “Our job as a retailer is to seek out unique products that offer the best value to our customers.  This includes our wine and spirits business, which has grown tremendously in our stores outside of New York State.  

New York State law does not permit us to sell these products, but wholesalers we work with have made them available to all New York State liquor stores.  In fact, they are carried by stores that have no connection to Wegmans whatsoever.

The NYSLA recently informed us of their position that only a licensed New York wholesaler can perform some of the steps involved in bringing these products to the New York market.  Wegmans, which conducts its business with the very highest integrity, immediately cooperated and corrected the alleged violation.”

In terms of the total $1.1 million in fines, Wegmans statement goes on to say that, “With regard to the size of the fine, we say this:  Everything costs more in New York State, except shopping at Wegmans.”