State Distribution Laws
Wyoming
License Needed to Self-Distribute: Yes
Statute: Wyo. Stat. § 12-2-201; Wyo. Stat. § 12-4-412; Wyo. Stat. § 12-5-401
In Wyoming, brewers holding a microbrewery permit (producing less than 50,000 barrels per year) can also become licensed as a malt beverage wholesale distributor, which allows them to self-distribute. The state liquor board may also grant temporary self-distribution rights to breweries that are unable to get their products distributed through a wholesaler in certain locations.
Brewers using a wholesaler to distribute their products must provide those wholesalers with a written distribution agreement and exclusive territories for the brands they distribute. Additionally, among other things, brewers are prohibited from:
- Forcing wholesalers to accept beer they haven’t ordered
- Refusing to deliver products to wholesalers in a reasonable amount of time after they’re ordered
- Preventing wholesalers from changing the capital structure of their businesses
- Discriminating between wholesalers
- Setting the resale price for their products
- Requiring wholesalers to purchase one brand as a condition of purchasing another
- Changing a wholesaler’s quota in bad faith
- Requiring or prohibiting a wholesaler from changing its manager unless the brewer has good cause to do so
- Requiring wholesalers to participate in an advertising fund controlled by the brewer
- Restricting the free association amongst wholesalers
- Unreasonably withholding their consent to the transfer of a wholesaler’s business
Brewers cannot terminate or not renew their distribution agreements without good cause. Good cause is when the wholesaler fails to comply with a reasonable and material term of its distribution agreement, which the brewer must have learned about within 2 years before taking action. The brewer must also provide the wholesaler with at least 30 days’ written notice of termination, allow the wholesaler 30 days to submit a plan to correct the problem, and allow an additional 90 days to actually fix the problem. However, brewers are allowed to immediately terminate their distribution agreements when:
- The wholesaler becomes insolvent or bankrupt
- The wholesaler has its license suspended or revoked for more than 60 days
- The wholesaler or an owner of 10% or more of the wholesaler is convicted of a felony
- The wholesaler intentionally sells products outside of its territory
- The wholesaler commits fraud in its dealings with the brewer.
If a brewer terminates its distribution agreement without good cause, or without giving proper notice, the brewer must pay the wholesaler for the fair market value of all assets the wholesaler used in distributing the brewer’s products. Additionally, if the distribution agreement requires the wholesaler to maintain a certain inventory, the brewer must repurchase the wholesaler’s current inventory at its laid-in costs, regardless of whether the agreement was terminated with good cause and proper notice.
