Lawsuit Claims Walmart’s Private Label Craft Beer Is “Wholesale Fiction”

It can be hard to tell if that craft beer on the grocery shelf comes from the vats of a small, independent brewer, or if it is the product of a commercial vat. That’s the crux of a new class-action seeking lawsuit that claims Walmart is deceiving consumers with its private label “craft” beer brands in an effort to inflate prices.

A beer drinker’s lawsuit [PDF] filed in the Hamilton Count, OH court of Common Pleas claims that calling the beverages — made in collaboration with Trouble Brewing under the names Cat’s Away IPA, After Party Pale Ale, Round Midnight Belgian White, and Red Flag Amber — craft beer is a “wholesale fiction,” because they’re actually mass-produced.

According to the complaint, Trouble Brewing “doesn’t really exist,” echoing a recent Washington Post article that pointed out the applicant listed on filings with the Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau (TTB) is ‘Winery Exchange Inc.’, which has since turned into WX Brands.

“WX Brands ‘develops exclusive brands of wine, beer and spirits for retailers around the world’ according to its website,” the lawsuit notes. “But under the ‘brewery address’ section of the TTB filings, Genesee Brewing’s business office in Rochester, NY, is listed instead. Genesee is owed [sic] by another company that brews Costa Rican lager among other industrial brands. Upon information and belief, Genesee produces well over the prescribe amount that would be considered ‘small.’”

The complaint also points to the Brewers Association definition of a craft brewer as “small, independent, and traditional,” and a business that produces less than six million barrels of beer annually; is less than 25% owned or controlled by a non-craft brewer; and that makes beer using only traditional or innovative brewing ingredients.

Walmart’s line of beers “is a wholesale fiction created by the defendant … designed to deceive customers into purchasing the craft beer at a higher, inflated price,” the lawsuit claims.

“Defendant stocks its craft beer next to other ‘craft beers’ for sale in its stores, rather than with other mass produced beers, such as Budweiser, Miller, or Coors products,” the complaint reads. “Again, by placing the craft beer on its shelves with other ‘craft beers’, defendant is further perpetuating the myth that it’s a craft beer.”

The lead plaintiff is seeking to represent a class of Ohio residents who have bought the beer in question, as well as compensatory and punitive damages for violations of the Ohio Consumer Sales Practices Act, fraud, and unjust enrichment, and an injunction preventing further false and misleading advertisements regarding the beer.

[via Courthouse News]

Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.