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Massachusetts Supreme Court Overturns Ruling Allowing Retailers To Sell Below Invoiced Wholesale Prices

July 25, 2019

The Massachusetts Supreme Court issued a decision yesterday that overturns a previous ruling allowing retailers to sell wine and spirits below their invoiced wholesale costs.

Total Wine & More sued the Massachusetts Alcoholic Beverages Control Commission (ABCC) in 2016 in a bid to pass on bulk discounts that it receives from wholesalers to consumers. In 2017, Total won a victory in the case when Judge Robert Gordon ruled in its favor.

But the Supreme Court overturned that decision, agreeing with the ABCC and the Massachusetts Package Store Association that “the net cost of liquor or wine sold to a licensed retailer, including any credits applied to that sale from cumulative quantity discounts, must be reflected in the invoice for that sale.” Previously, retroactive volume discounts allowed Total to sell below its invoiced cost. In its decision the Supreme Court cited “the plain language” of the state law and the ABCC’s “need to effectively and uniformly enforce its own regulations in accordance with its legislative mandate,” in overturning the lower court ruling.

Total Wine, which has six locations in the state, has consistently argued that it’s in compliance with the law against selling below cost when those bulk discounts are taken into effect.—Daniel Marsteller

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