Beer Sales being Pulled from Ebay

For those of you that may have missed it, but many breweries are working towards getting EBay to stop the resale of "hard to get beers":

http://beerpulse.com/2012/07/hill-farmstead-brewery-tackles-reselling-of-its-beers-on-ebay/


*This is not intended to be a debate! It is intended for knowledge only!*

Good. Why shouldn't they? It's already against their policy to sell alcohol- there's no age verification. Besides, it's another way customers can get screwed- either they end up with subpar beer that hasn't been stored or handled properly, or the end up with an empty bottle, which is how the ads are typically phrased. Support your favorite craft breweries by buying directly from them or the distribution channels they authorize. If a beer is hard to get, tough. Chances are your local brewery makes hard to get beers other people can't get. Try to grab a bottle the next time you're in the area.

Well, it is an interesting subject. Personally, I think the brewery should STFO of what happens after they sell their beer. They can only set up a sale to make it as fair an honest as they can. They can't read someone's mind and know if the next person in line is going to go home and put that beer up on Ebay. They say they care about people who stood in line and didn't get any, but there is no way they can sort them out and make sure they all get some. Maybe they need to unlimit the limited releases???

I think it's a problem they created themselves by driving up demand in the first place.

Something else to think about: What about people who live too far away and will NEVER have a reasonable chance to stand in line? The Ebay sales are a way for them to spend WAY too much money for the privilege of tasting the rare beer. The ebay seller is merely providing a means for those unlucky people (even more unlucky than those who were at least able to TRY for a bottle!) to get some.

As far as the ebay auction itself, the seller always seems to claim that the bottle is the item being sold, not the beer inside. Opening the bottle would ruin it's collectivity. So the seller is forced to sell only unopened bottles lest the bottle's value is diminished. Regardless, selling alcohol in ANY case is against policy and I think the law as well, so I think as long as Ebay can continue to monitor sales such as these (I've seen PLENTY of them) then the problem kind of takes care of itself (mostly, since there is still CL and FB and other avenues).

In the end, I find Hill's comments a bit harsh. He is taking very strong measures in support of a very few people and I'm not convinced the effort is worth it, or will be rewarded. Bottom line is that everyone has a shot at attending the sale and getting their hands on the beer, if they wish to take time off work, travel, get there early, stand in line, etc.

It's the brewery's *fault* that there is a limited amount. They are the ones who created the hype, the hysteria, and the desire for the product. So I don't understand why they get all bent out of shape when the expected happens because of it. #callingmrobvious

It's at least partially because these limited release beers are just that: limited. They're not designed for wide distribution, they're for the local audience- typically a brewery's most fervent patrons. In an age where you can eat fresh tomatoes year round, people forget what it means to make a product for local sale. People who attend bottle releases and hoard them to sell on ebay at ridiculous prices prevent real fans from being able to drink them so that a few idiots can overpay to drink that beer when it almost certainly hasn't been stored or transported properly. Then, Mr. Moneybags gets a not-so-tasty special release and writes bad reviews about the brewery to top it all off.

All of this completely ignores the illegality of selling alcohol without a license, without age verification, and then transporting it over state lines.

Meh...

Haven't used e-bay in years, and I have no plans to go back anytime soon.

If I owned a brewery I wouldn't want some hijack off buying a bunch of my beer and selling it online. That takes all control out if your hands and this yahoo is making money off your your name. When buying online you don't even know that the bottle you are purchasing actually contains the beer it's supposed too! Bottom line, the brewery has its reputation on the line based off of how well their beer shows, someone hordes a bunch and keeps it in their driveway for two months trying to sell it by the time you taste it the beer will be crap and you'll think the brewery sucks...

Homercidal said:

It's the brewery's *fault* that there is a limited amount. They are the ones who created the hype, the hysteria, and the desire for the product. So I don't understand why they get all bent out of shape when the expected happens because of it. #callingmrobvious

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So do you propose all local breweries should start out with the capacity of a BMC brewery or should they just avoid the limited releases all together?

Scalping will never go away. It is just more visible online and is enabled through this technology. Its just like bootlegging cd's, etc. If there is demand then there is gonna be someone who will try to make a buck. I personally being an old deadhead believe in the spirit of trade and gift.

If businesses should have control of products AFTER the sale of said items; shouldn't consumers have control of how the money is spent after purchase of said items? Their just disgruntle bullies.

Ha it's the internet of course there will be debate. If the argument is legal base for selling alcohol, yeah close the auctions refine the terms of sale. I'm in favor of selling bottles on EBay. If I want to spend my money on an over priced bottle of Dark Lord or Hunahpu, why should the brewery care. They got their money when the Ebay seller picked up the bottle. If they don't like it, jack up the prices of event tickets. This is no different then a vintage bottle of wine or picking up a comic book at a garage sale and going to the net. Supply and demand, the brewery controls the supply, we provide the demand. Laz, ever bought skunk beer from a liquor store? I have, I don't blame the brewery, its the distributor that failed to turn over the shelves. Think of it like a non traditional three tier system Brewery - Distro - Buyer.

If someone is scalping brews and selling on eBay then the brewery has legal rights. I would think it is unlawful for me to buy a six pack and then sell it for a profit on eBay (of coarse the work around is to add something to the beer- the brew shirt is $40 but I will throw in a 6pack for free).

And if someone wants a specific limited brew, wouldn't it be better for that person to contact the brewer directly? Then it would be fresher and not go through a middle man/woman.

I'm not with the breweries on this one. If I buy your beer, STFU about what I do with it. You can't severely limit the supply of something without creating a lot of demand, unless, of course, you make a sub-par product. The brewers have made their money, and people who would never have a chance at trying their beer are doing so by buying on Ebay. The brewers in this case, in my opinion, are being major a$$holes. A guy standing in line to buy a limit of 1 or 2 brews and reselling them is not anywhere near the same as computer banks buying up tickets as soon as they are being sold, tying up phone lines, and flipping hundreds or thousands of tickets. It is not "scalping," it's like a few dudes buying two brews, drinking one, and selling the other. All the to-do is probably more to do with the fact that the breweries have to make it look like they give a $hit about the "diversion" of a heavily taxed item and controlled by they BATF.

itsbeeryo said:

So do you propose all local breweries should start out with the capacity of a BMC brewery or should they just avoid the limited releases all together?

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I don't propose anything like that. I don't have a problem with limited released, or limited availability.

What I propose is for the brewer to not make such a fuss over something they created. Now they are talking about not bottling limited beers, to spite the scalpers. So now even the locals can't carry that bottle of special beer to a gathering and share with friends, or give to friends as gifts to be enjoyed at their time and location of choosing.

The illegality of selling beer is not in question at all. EVERYONE should understand this fact. Selling ANY bottle still containing an alcoholic beverage is illegal. But it should be up to Ebay to make sure that it's not happening. It's in the guidelines. People who do so should be warned and then banned.

It's overreacting by the brewer. IMO they should do what they can to see that everyone who shows up has a fair chance to buy their bottle. After that, it's K ser ah.

As far as people drinking the beer and refilling the bottle, I don't think the brewery should be held responsible if people don't like it. That's the fault of the purchaser who took the chance that they seller was honest. As a homebrewer I understand that swapping out the contents would be redonkulasly easy. (unless it was waxed or tagged or something.)

But whatever. in this case it sounds like the brewer is going to be ****** and not let ANYONE buy it in bottles to share with others, just because a few people sell some bottles on ebay.

Homercidal said:

But whatever. in this case it sounds like the brewer is going to be ****** and not let ANYONE buy it in bottles to share with others, just because a few people sell some bottles on ebay.

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Reminds me of frigid fourth-grade teachers punishing an entire class because one kid cheats on his test. I'd like a list of all the breweries who are thinking of doing this so I can express my displeasure to them directly. As homebrewers, we are quite possibly the most fervent, vocal, and loyal customer base of craft breweries. Our opinion counts for something.

That brewery should focus all that energy on their good customers. I can see why they don't like it, but giving seller publicity isn't going to help if he's doing everything legally. Shake your head and move on.

Lazarous said:

If I owned a brewery I wouldn't want some hijack off buying a bunch of my beer and selling it online. That takes all control out if your hands and this yahoo is making money off your your name. When buying online you don't even know that the bottle you are purchasing actually contains the beer it's supposed too! Bottom line, the brewery has its reputation on the line based off of how well their beer shows, someone hordes a bunch and keeps it in their driveway for two months trying to sell it by the time you taste it the beer will be crap and you'll think the brewery sucks...

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Russian River started taking IDs at their limited release sales. Problem solved, at least as far as they should be concerned. And even if some jerk sells 1 false bottle and even if some poor sap buys it and is really tasting negra modelo or some $hit, how would one bad review out of thousands make a difference to their reputation?

If the brewery wants X dollars for a 6 pack, and they get that, then what's the problem? They are not losing any revenue here. Maybe they don't like what I do with the beer after I buy it, but that's none of their f'ing business.

Too many laws in this country. Freedom erodes every day, redefined by the double-speaks in govt.

passedpawn said:

If the brewery wants X dollars for a 6 pack, and they get that, then what's the problem? They are not losing any revenue here. Maybe they don't like what I do with the beer after I buy it, but that's none of their f'ing business.

Too many laws in this country. Freedom erodes every day, redefined by the double-speaks in govt.

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Of course the brewer should care about what happens to their product after its sold. You'd never argue that they shouldn't be involved in how the distributors handle their product, but that's after they sell it as well.

To carry the analogy further, if they found a distributor was doing things to their beer that they didn't approve of, they'd be free to not sell to that distributor.* They don't like what some of their other customers are doing with their beer, but its much harder to control individuals, so they're trying to find a way around it. If they decide the only way to be satisfied with the product they make is to go draft-only, I understand and sympathize.

*Yes, I know franchise laws make that not so cut-and-dry; its a simplification.

I was ONLY able to get a few bottles of Founder's KBS this year because the DISTRIBUTOR that had CASES and INDIVIDUAL BOTTLES up for sale on Ebay was not getting the super inflated prices they were hoping for or they were not selling them fast enough. This speaks volumes about the corrupt distribution industry and tells me to NEVER buy beer from Ebay or a like source.

Give the beer back to the people! I am not implying a brewery should take losses but these over hyped beers are just that...

I'm surprised eBay allows this practice to go on. Yeah, I know what sellers put in the description. That you're buying a bottle. That's only half correct, you're buying a bottle filled with alcohol, something you have to be a certain age to buy and have a license to sell.

I've never bought beer on ebay. I'd like to try a bottle of Dark Lord, but to me it's not worth paying some big markup on.

Well, what about the rare wine auctions and sales? Wines sell for ridiculous prices at these. The Vintners aren't upset as it speaks to the value of their product. I can see trying to shut down people who are dishonest but if someone buys a limited release and someone wants it he is the owner not the brewery so he names the price. Is the brewery that worried or couldit be the money that is being made off there product that they are missing?

See: Coase theorem

<Insert socialist jab at brewery>

Ebay has been breaking the law with alcohol sales for years now. It's time they place tighter restrictions. Only a licensed bonded vendor should be able to participate on ebay.

I could have sold thousands of dollars worth of Russian River beers when they first opened...But I didn't. Simply because I think it's tacky to sell a product at hyper inflated prices.

I don't know.......I waited in line for Dark Lord Day...it was cold and overcast and I waited about 4 hours for 4 beers....so will I sell mine, no. However if I did, my time, travel, etc probably cost more then I would get anyways.

If the breweries want to stop this, they will have to only have it available for "server only" if they have a brew pub or restaurant...and or distribute via keg to bars that carry their product.

Just like I would love to try Goose Island Bourbon County stout, but can't justify the price. Rather make my own.

Shuldawg said:

If someone is scalping brews and selling on eBay then the brewery has legal rights. I would think it is unlawful for me to buy a six pack and then sell it for a profit on eBay (of coarse the work around is to add something to the beer- the brew shirt is $40 but I will throw in a 6pack for free).

And if someone wants a specific limited brew, wouldn't it be better for that person to contact the brewer directly? Then it would be fresher and not go through a middle man/woman.

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You should familiarize yourself with the concept of "first sale" doctrine.

This is a concept in law where a copyright or trademark owner's rights are limited after the product is sold.

This is why, for example, Sony cannot outlaw the re-sale of music and video that have already been sold at retail.

Historically, it's origins in case law come from publishers trying to outlaw used book stores. I am not a lawyer, but i suspect that first sale doctrine applies here as well, unless these beers are being sold "out the back door" by distributors rather than by people who purchased them at retail.

As for the issues of federal and state laws, as i understand it the sale of beer, wine, and spirits over state lines has to be brokered by licensed dealers, much the same way it works when selling firearms over state lines.

This is why when you purchase wine online from wine.woot.com for example, it is shipped to a local liquor store where you pick it up. The onus is thus on the receiving agent to assure that drinking age restrictions are followed, etc.

if someone was brewing beer, putting it in hill farmstead bottles and selling them this brewer would have a legitimate gripe. once the item is sold it belongs to the buyer, maybe he should start leasing the beer?

eastoak said:

if someone was brewing beer, putting it in hill farmstead bottles and selling them this brewer would have a legitimate gripe. once the item is sold it belongs to the buyer, maybe he should start leasing the beer?

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Also if they have consigned bottles to a licensed distributor, and said distributor is putting them on ebay instead of delivering them to retail outlets, they would have a legitimate gripe.

But generally once you've purchased something you have every right to sell it however and to whomever you want. Except for predatory practices like ticket scalping, which gets into a whole other set of laws.

daksin said:

Good. Why shouldn't they? It's already against their policy to sell alcohol- there's no age verification. Besides, it's another way customers can get screwed- either they end up with subpar beer that hasn't been stored or handled properly, or the end up with an empty bottle, which is how the ads are typically phrased. Support your favorite craft breweries by buying directly from them or the distribution channels they authorize. If a beer is hard to get, tough. Chances are your local brewery makes hard to get beers other people can't get. Try to grab a bottle the next time you're in the area.

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Caveat emptor!

All the previous posts have brought up good points. One thing I'll add is that if a brewery is concerned about the reselling of their limited releases by unauthorized sellers, they could prevent it by offering limited releases only on tap at their facility, or opening the bottle at the point of sale. Depending on the facility, this may or may not work.

TimpanogosSlim said:

Also if they have consigned bottles to a licensed distributor, and said distributor is putting them on ebay instead of delivering them to retail outlets, they would have a legitimate gripe.

But generally once you've purchased something you have every right to sell it however and to whomever you want. Except for predatory practices like ticket scalping, which gets into a whole other set of laws.

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isn't alcohol the exception?

this isn't just some retail item - it's a regulated substance

you can't sell or ship alcohol without a proper license afaik

govner1 said:

Caveat emptor!

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Doesn't apply here except that the buyers may get screwed on the ebay purchase.

The problem is that the scalpers are causing real harm to the brewery; twice, potentially: first by preventing real fans (local patrons) from enjoying that beer, and secondly by reselling damaged (improperly stored) beer which will hurt the brewery's reputation.

daksin said:

Good. Why shouldn't they? It's already against their policy to sell alcohol- there's no age verification. Besides, it's another way customers can get screwed- either they end up with subpar beer that hasn't been stored or handled properly, or the end up with an empty bottle, which is how the ads are typically phrased. Support your favorite craft breweries by buying directly from them or the distribution channels they authorize. If a beer is hard to get, tough. Chances are your local brewery makes hard to get beers other people can't get. Try to grab a bottle the next time you're in the area.

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No free market?
If someone wants to spend $50 on a Russian River bomber, who cares? Russian River isn't going to make any less on it.

Lazarous said:

If I owned a brewery I wouldn't want some hijack off buying a bunch of my beer and selling it online. That takes all control out if your hands and this yahoo is making money off your your name. When buying online you don't even know that the bottle you are purchasing actually contains the beer it's supposed too! Bottom line, the brewery has its reputation on the line based off of how well their beer shows, someone hordes a bunch and keeps it in their driveway for two months trying to sell it by the time you taste it the beer will be crap and you'll think the brewery sucks...

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The same argument could be made for used cars, should we ban used cars sales, for the sake of GM of course...

Lazarous said:

If I owned a brewery I wouldn't want some hijack off buying a bunch of my beer and selling it online. That takes all control out if your hands and this yahoo is making money off your your name. When buying online you don't even know that the bottle you are purchasing actually contains the beer it's supposed too! Bottom line, the brewery has its reputation on the line based off of how well their beer shows, someone hordes a bunch and keeps it in their driveway for two months trying to sell it by the time you taste it the beer will be crap and you'll think the brewery sucks...

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selling the beer takes the control out of the brewers hands anyway. the brewer carefully crafts the brew then sells it to someone who may keep it in their driveway for 2 months then serves it at a party, what will people think? most people dislike the whole idea of scalping especially when the price is many times the original price but this brewer is charging at windmills.

What about this for thought. It comes up on here all the time...
"What if I do this or that and person A pays me $50, and then I give them some homebrew as a gift" <- Always gets shot down as illegally selling homebrew (and rightly so)
So then what if
"I bottle my homebrew and then put it on ebay to sell the special (because there is only one ever of this exact bottle) beer bottle, I must leave the beer in it otherwise it would not be a beer bottle and just an ordanary everyday bottle" <- as one of the BMCs of New Zealand says, Yeah right!
Only difference between this and the above is the liquor tax has already been paid by the brewery.

I know there are Ebay approved wine brokers....maybe there is a market for the same thing for beer? A business opportunity for someone!! Of course they are fully licensed and adhere to the alcohol laws.

Phunhog said:

I know there are Ebay approved wine brokers....maybe there is a market for the same thing for beer? A business opportunity for someone!! Of course they are fully licensed and adhere to the alcohol laws.

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Just don't try to advertise here you capitalist pig!!!

The only legitimate problem here is that the sales are not permitted (neither by law, nor by ebay policy).

There is simply no legitimate basis for the manufacturer to prevent subsequent sales of its product by a retail purchaser. Yes, obviously it's in their interest to protect their brand identity, but that's just not how selling something works. If they want to enforce something like this, they need to arrange a contract in advance. This is what they do with distributors, and why they have control over the terms of distribution. If the sale is legally permitted, they are no longer party to the transaction.

The only valid exception I can think of would be if someone is misrepresenting the contents of the bottle. In that case, it could be a trademark violation.

Note that there have been some absurd laws/court decisions involving importation of copyrighted works into the US---IIRC, a high end watch maker successfully blocked grey market imports on the basis that their logo was copyrighted and copyright conventions gave them legal control over the import market. This is, IMO, plainly absurd, and in any case doesn't affect domestic sales.

zeg said:

The only legitimate problem here is that the sales are not permitted (neither by law, nor by ebay policy).

There is simply no legitimate basis for the manufacturer to prevent subsequent sales of its product by a retail purchaser. Yes, obviously it's in their interest to protect their brand identity, but that's just not how selling something works. If they want to enforce something like this, they need to arrange a contract in advance. This is what they do with distributors, and why they have control over the terms of distribution. If the sale is legally permitted, they are no longer party to the transaction.

The only valid exception I can think of would be if someone is misrepresenting the contents of the bottle. In that case, it could be a trademark violation.

Note that there have been some absurd laws/court decisions involving importation of copyrighted works into the US---IIRC, a high end watch maker successfully blocked grey market imports on the basis that their logo was copyrighted and copyright conventions gave them legal control over the import market. This is, IMO, plainly absurd, and in any case doesn't affect domestic sales.

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You mean Rolex vs. Costco?

Costco had purchased a bunch of rolexes at good prices from licensed dealers outside of the USA and wanted to import them and sell them in Costco stores at a modest profit. They owned the watches outright. Rolex was able to seize them because Costco is not a licensee of the Rolex name and logo.

Rolex jumps through a lot of hoops to control their brand as tightly as possible and charge you thousands of dollars for a watch that would be worth about $800 without their name on it.

One of those hoops is that the USA version of Rolex is actually a company that licenses the rights to the logo and other marketing IP in the USA from the swiss company.

All the same people are on the board of directors of both companies.

If you own a rolex and leave the country with it, you damn well better fill out the paperwork proving that you own it before you leave the country, because Rolex can have it seized at the border when you re-enter.

As a strong supporter of my local breweries, I go to a lot of limited release events. None of them are as crazy as KTG, Dark Lord, etc. However, I would be royally pissed off if I saw people hoarding up as many bottles as possible to put up for sale on the internet. It takes away from the local, "regulars", benefit that limited release beers were intended to provide IMHO.