Amazon Investigated in CA for Liquor Law Violations

Amazon is under investigation in CA for bending existing laws that require stores that deliver to be based out a brick and mortar and be open for at least half of the hours they deliver for. Amazon is disobeying these last and not being shy about it. Again, Amazon will circle the wagons with their legal team(s) and challenge and maybe even try and change existing law. This is just another sign of Amazon and massive big box retailers doing their best to shut down every independently run family business. PLEASE join the fight and get involved!

See article below for more details.

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Amazon Above the Law in California

The unassuming entrance isn’t open to the public, despite the law saying it should be.

US editor W. Blake Gray visits a “retail store” in LA that doesn’t seem to exist.

Source: https://www.wine-searcher.com/

19-Aug-2019

Amazon is openly flouting California liquor law.

In February, Amazon, doing business as Prime Now, was issued a liquor license to open a liquor store in Los Angeles. California requires businesses that offer alcohol for home delivery to have a brick-and-mortar store. So Amazon got a license for a store that would be in the same building as its enormous Prime Now warehouse in an industrial part of north Los Angeles.

Prime Now’s license specifically requires the store to stay open for half of the hours that Amazon does liquor deliveries from its warehouse. Amazon offers deliveries for 16 hours per day; therefore, it must be open for eight hours. There are other requirements, including offering for sale any bottle of wine or spirits that it offers for delivery from the warehouse.

I reported on the existence of this Amazon “secret store” last week. My editor and I pored over Google Earth images of the address and we didn’t see anything that looks like a store. That piqued my interest, and I convinced my editor to splurge for an airplane ticket and some Uber fares for me to go visit this store.

I thought it might be a closet-sized space with one employee, or something like that. The license doesn’t require the store to actually have all the merchandise in the store; they could have an iPad catalog and they could fetch the liquor from the warehouse, and that would be legal. I thought I’d jet down there, buy a bottle of rye whiskey, have some good LA food (finally I checked out the natural wine list at Night & Market Song), and write a story. Tentative headline: “I bought a bottle of rye whiskey at Amazon’s Secret Store.” People would read that, I thought.

This is key: I picked out what I wanted to buy ahead of time by looking carefully at what Amazon offers for delivery from the warehouse. Prime Now offers liquor deliveries in the warehouse’s zip code from three places: Amazon (the warehouse), Whole Foods and Mission Wine & Spirits. The “store” would only be required, under California law, to offer the same wines and spirits delivered from Amazon, not from Whole Foods or Mission.

Amazon’s wine selection from its Los Angeles warehouse sucks: no wines from Alsace, Rias Baixas, Roero or Lugano (it was hot when I first looked and I was in a white-wine mood.) I decided I would get a bottle of Templeton Rye Whiskey that Amazon offers through Prime Now for $30.99. I saved some screenshots of the products offered – this is also key, because it’s possible that Amazon will change its practices after publication of this story.

I got to the warehouse, which is enormous. My Uber driver had a little trouble finding the full address I gave him, so he dropped me nearby. There’s no Prime Now liquor store listed on the large sign on the street for the industrial complex. And guess what?

THERE IS NO LIQUOR STORE THERE.

Amazon is openly flouting the conditions it agreed to just six months ago.

I wanted to be sure, even though the building has several No Trespassing Private Property signs. I thought maybe the store was inside the warehouse. And I wanted to be thorough.

The address of the Prime Now “store” on its license from the California Department of Alcoholic Beverage Control (ABC) is 3334 N San Fernando Rd Unit 101. There’s only one other business at 3334 N San Fernando Road: an air-conditioning company called Goodman Distribution. I walked in and asked if they are Unit 101. They’re Unit 102, I was told; helpfully, they explained that Unit 101 is on the exact opposite side of the building.

There is a door at that corner, and it’s forbidding. A sign reads “Associate Entrance.” There’s also a sign that reads “Restricted Area. No Trespassing. Private Property. Authorized Personnel Only.”

Not exactly open to the public.

I knew I would try to open the door despite that sign, but I wanted to check every other possibility first.

Amazon has jumped into the private delivery business in a big way. Many private individuals bring what look like their own cars to the warehouse to pick up deliveries. There’s an entrance for them – Amazon Flex Delivery Partners – so I went into it. People were busy filling grocery bags with orders.

I found an employee wearing a badge; likely a low-level person I don’t want to get fired, so I won’t ID her. I said I was looking for the liquor store.

“That’s not open right now,” she said. (It occurred to me later that she had been coached to say this.)

I said I wanted to buy a bottle of whiskey.

“You have to order it online,” she said.

I said I was told there was a liquor store here. She said: “It hasn’t been open for a couple of weeks.” She said the building is under construction.

Once inside the door, you are confronted with a forbidding security turnstile and no sign of a retail store.© W. Blake Gray/Wine-Searcher | Once inside the door, you are confronted with a forbidding security turnstile and no sign of a retail store.

Fine. I went around the corner and timidly opened the door for the Associates Entrance.

It’s like a jail in there. There’s a very small foyer and the rest of the office is blocked by a floor-to-ceiling orange-and-blue revolving security door that won’t open without an employee ID badge. Nobody was working inside; nobody responded to my calls of “Hello? Hello?”

There’s a button that says Press for Assistance. I did this twice in the 10 minutes I stayed in the foyer. No response. While waiting, I read the legal notices on the wall. One is a City of Los Angeles Tax Registration Certificate. It gives the address: 3334 N San Fernando Rd Unit 101. I’m here! This intimidating, unstaffed foyer is the Amazon secret liquor store!

Here are the ways in which this violates the license issued by the state of California:

All alcoholic beverages offered for sale by delivery are supposed to be displayed in the “store”. In fact, there was no display of alcoholic beverages.

All alcoholic beverages offered for sale by delivery are supposed to be conveniently available in “the store”. In fact, there were no alcoholic beverages available.

On each day of the week when alcohol is offered for delivery, the store is supposed to be open for at least half of those hours. Prime Now offers alcohol deliveries from 8am to midnight, so the store should be open for at least eight hours. I was there at midday, 12:30 to 1:30pm. There was no store! So it wasn’t open.

The hours for the public opening of the store are supposed to be posted at the entrance to the premises. There was no such notice; only the “Restricted Area. No Trespassing. Private Property. Authorized Personnel Only” sign.

I called the California ABC to ask what the possible penalties are for egregious multiple violations of a liquor license. But I didn’t want to give away the story, so the agent I spoke to had to work with hypotheticals, and he pointed out that the ABC’s definition of “egregious” might differ from mine.

He also told me that the specific restrictions on an alcohol license like Prime Now’s come with the full knowledge and consent of the person applying.

“They are conditions that the applicant agrees to before they become the licensee,” Matthew Hydar, supervising agent for California Department of Alcoholic Beverage Control, told Wine-Searcher.

Is not even opening the store you agreed to open egregious? Even if so, Amazon might get off easy.

Hydar said that some first-offense violations would receive just a notice of violation.

“With multiple egregious offenses, we would look at anything from a fine, which would range from $750 to $3000, or, but not and, a 15-day license suspension,” Hydar said. “We can levy fines and suspensions and revocations. This will all depend on the investigation.”

Hydar said ABC works with local law enforcement on license violations. It won’t be hard for the LAPD to help: there’s a big police station almost directly across the street. A police officer could walk over there this very afternoon.

Hydar sent me a list of Penalty Policy Guidelines for the ABC. Most of the potential penalties Amazon can shrug off as a cost of doing business. But if Prime Now is found guilty of “Misrepresenting Material Fact on Application,” the recommended penalty is license revocation.

I don’t know if there ever was a liquor store at 3334 N San Fernando Rd, but as of last week, there wasn’t, and apparently there aren’t plans for one either. There is a construction trailer adjacent to the building, so I walked in and asked if they’re building a liquor store.

“No sir. There’s no liquor store,” the construction foreman told me. “You can order a bottle of liquor online and they’ll deliver it to you in two hours. But there’s no liquor store here.” And they’re not building one either, he said.

I had brought bubble wrap with me, preparing to bring home a bottle of rye whiskey that I was going to charge to Wine-Searcher. I got no rye whiskey. But I did get a better story than I bargained for.

You can order whiskey or wine from the Amazon warehouse at 3334 N San Fernando Rd in Los Angeles. But there’s no liquor store open to the public there, in clear violation of California law.