$10.3M

September 9, 2020 | Number of The Day
Total penalties imposed on leading wine and spirits wholesalers, top retail customers

The Division of Alcoholic Beverage Control has socked two of New Jersey’s largest liquor wholesalers — Allied Beverage Group and Fedway Associates — with fines of $4 million apiece for engaged in discriminatory trade practices that unfairly favored their largest retail customers. In addition, 20 retailers statewide will pay a total of $2.3 million for their part in the unlawful scheme.

ABC’s two-year investigation found that the wholesalers, which account for approximately 70% of all wine and 80% of all spirits sold at wholesale in the state — unfairly favored 20 of New Jersey’s largest wine and spirits retailers and put smaller retailers at a competitive disadvantage. The two wholesalers, which were hit by record fines, manipulated the retailer incentive program (RIP), granting credit extensions and interest-free loans, and engaging in other discriminatory practices.

“Simply put, Allied Beverage Group and Fedway Associates rigged the market in favor of a handpicked group of powerful retailers, leaving smaller businesses struggling to compete,” said Attorney General Gurbir S. Grewal, adding, “This settlement sends a clear message that we will not tolerate this manipulative and anticompetitive behavior.”