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Prohibited Interlocking License Interests: Retail and Manufacturing

This article was originally published in The Pennsylvania Observer / Pennsylvania Beverage Media in December 2022. A pdf version can be found here.

Retail licensees providing musical entertainment must be extremely careful not to allow amplified music to be heard off of their licensed premises. Usually, amplified music heard off of the premises will generate complaints from neighbors or the local police and result in a citation or citations being issued by the Pennsylvania State Police Bureau of Liquor Control Enforcement.

The Pennsylvania Liquor Code makes it unlawful for licensees to use a “loudspeaker or similar device whereby the sound of music or other entertainment” or the advertisement thereof can be heard beyond the licensee’s property line. Furthermore, the Liquor Code authorizes the Pennsylvania Liquor Control Board (PLCB) to review a licensee’s citation record and operating history to determine whether or not the licensee has abused the privilege of holding a liquor license to such an extent that either the liquor license or the amusement permit or both should not be renewed or validated. Should there be a sufficient number of separate citations for amplified music, for example, four citations within a period of a year, the board may decide to issue a notice objecting to the renewal or validation of a licensee’s amusement permit because of the citations.

The board’s objection letter will also contain an objection naming the individuals listed as shareholders, officers and directors, members, or partners, and the manager involved in the entity holding the license as being potentially no longer considered reputable as required by the Liquor Code because of the citations. The PLCB will schedule a hearing on whether or not the licensee’s amusement permit will be renewed. Pending the hearing the licensee will be issued an authority letter to sell alcoholic beverages and provide entertainment.

At the hearing, which is held before a PLCB hearing examiner, the licensee will have to present evidence as to what steps that the licensee has taken to correct and prevent a repetition of the amplified music violations, for example, soundproofing or keeping the windows closed. Thereafter, the PLCB will make a decision on the renewal of the amusement permit. If the PLCB decides not to renew the permit, the licensee then must appeal the decision to the local county court of common pleas within twenty (20) days of the board’s decision.

The amusement permit will be renewed if the licensee presents a strong case at the PLCB hearing. However, the board, before it approves the renewal of the amusement permit, may require the licensee to enter into a Conditional Licensing Agreement which would impose certain conditions or restrictions on the liquor license and/or the amusement permit to prevent future violations.

Licensees must be vigilant in preventing amplified music from being heard beyond its property line since amplified music violations could result in the board either refusing to renew the liquor license and/or amusement permit or the Pennsylvania State Police Bureau of Liquor Control Enforcement issuing a citation for the violation.

Licensees should consult with their attorney on this issue.

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