Attorney General Cuomo Requires Chautauqua Beer Distributors To Payback Local Chautauqua Merchants Overdue Handling Fees

BUFFALO, N.Y. (September 15, 2008) - New York State Attorney General Andrew M. Cuomo today announced that he has reached an agreement with the four largest beer distributors in Chautauqua County to repay local taverns $108,000 in fees withheld from them for more than ten years.

The agreement was reached after an investigation into allegations that the beer distributors failed to pay required handling fees to Chautauqua County taverns. The Returnable Container Act, also known as the “Bottle Bill,” is an environmental law designed to encourage recycling, and it requires distributors to pay a handling fee to the merchants that sell returnable containers to compensate them for collecting, sorting and storing containers returned by customers.

“For years, these four distributors have withheld money from local Chautauqua County businesses and that ends today,” said Attorney General Cuomo. “Small businesses form the backbone of our state’s economy. This agreement ends a long-standing dispute. These distributors recognized their obligations to the local taverns and this agreement ensures that they will be compensated appropriately.”

An investigation by the Attorney General’s office and the New York State Department of Environmental Conservation (DEC), found that four Chautauqua beer distributors were withholding a two-cent per container handling fee to taverns that sell returnable beer containers to go. The investigation also revealed that the distributors withheld payments to many taverns countywide for more than a decade, and withheld money from at least three taverns for up to twenty years.

The Chautauqua distributors involved in the agreement are Arthur R. Gren Co., Inc., George Bentges Distributing, Inc., Salamanca-Area Beverage Co., Inc., and J&M Distributing Co., which does business as Certo Brothers Distributing.

The agreement requires the distributors to provide a total of $108,000 in restitution to taverns that were denied past payment of handling fees. Distributors also agreed to immediately end the practice of withholding handling fees and, moving forward, pay taverns all fees required by the Bottle Bill.

“Everyone wants a level playing field when it comes to complying with not just the Bottle Bill but all environmental laws,” said DEC Commissioner Pete Grannis. “Our investigation and the Attorney General's settlement achieve that for these Chautauqua County merchants. In addition, in the long run it underscores the fact that the state will take action to ensure that Bottle Bill, which works to reduce litter and promote recycling, is taken seriously.”

The Bottle Bill has created a deposit system, encouraging customers to return their bottles for recycling, instead of throwing them away. Customers who buy bottles or cans pay a deposit on the containers, which is included in the price of the product. When they return the containers to local merchants, the customers are then refunded the deposits.

Merchants, including taverns, also pay deposits on the containers they purchase from beverage distributors. However, in addition to refunding these deposits, distributors are also obligated pay a handling fee to the merchants that sell returnable containers.

The case was handled by Assistant Attorneys Jane Cameron and Michael Myers, under the supervision of Special Deputy Attorney General for Environmental Protection Katherine Kennedy. Investigator Daniel Sullivan of DEC’s Division of Law Enforcement conducted the investigation.

The case is one of several being announced today as part of the opening of the Attorney General’s new Western New York Regional Office at Main Place Tower, 350 Main Street in Buffalo. The Western New York Regional Office is the largest of the Attorney General’s 13 regional offices, and serves the counties of Erie, Niagara, Chautauqua, Genesee, Wyoming, Alleghany, Cattaraugus, and Orleans. Home to approximately 100 employees, last year it opened more than 5,000 cases covering a myriad of legal matters from consumer protection to the defense of the state. The office serves as a ‘front door’ to the Office of the Attorney General for the people of Western New York.