Texas Supreme Court Answers Certified Questions in a Way that Package Liquor Stores Worry May Open Floodgates to Big Retailers

In a narrow holding on questions certified by the Fifth Circuit U.S. Court of Appeals, the Texas Supreme Court concluded Friday that a publicly held corporation, in a bankruptcy sale, may convey its permits to sell liquor to another publicly held corporation that did not enjoy a grandfather exemption against a state law ban on a public corporation’s ownership of package-store permits.In Gabriel Investment Group v. Texas Alcoholic Beverage, the Supreme Court determined that Gabriel’s grandfathered protection against the state liquor law prohibition does not constrict it from selling package-store permits to corporations.“We understand the questions to ask whether [Alcoholic Beverage Code] section 22.16(f) continues to exempt a public corporation if that corporation sells some or all its shares to a non-exempt corporation, and, if so, whether the exempt corporation can acquire additional package store permits,” the majority opinion by Justice Jimmy Blacklock framed the Fifth Circuit’s questions. “We answer both questions yes.”To listen to the amicus argument by the trade group Texas Package Store Association tell it, all hell will unravel for a restriction intended to protect “favorable business climate in the State of Texas and also to help ensure that retail sales of liquor in Texas are done…