Monday, February 13, 2012

Sioux tribe sues brewers for alcohol woes


The Oglala Sioux Tribe is suing some of the world's largest beer brewers, saying they knowingly have contributed to devastating alcohol-related problems on Pine Ridge Indian Reservation.

The lawsuit, filed Thursday in U.S. District Court of Nebraska, seeks $500 million in damages for the costs the tribe has incurred in dealing with crime and providing social services and health care as a result of rampant alcoholism among the 20,000 tribal members.
The suit is on behalf of the tribe, however, and no individual tribal members are plaintiffs and eligible for money.
It also targets four beer stores in Whiteclay, Neb., a tiny town in northwest Nebraska at the South Dakota border near the reservation. Despite only about dozen residents in town, the stores sold almost 5 million cans of beer in 2010 -- almost 250 cans per Pine Ridge tribal member. Alcohol is not legal on the reservation.

Tribal leaders and activists blame Whiteclay businesses for chronic alcohol abuse and bootlegging on the reservation. They say most of the stores' customers come from Pine Ridge.
"In a town of 11 people selling 4.9 million 12-ounce servings of beer, there is no way that alcohol could be legally consumed. It's just impossible," said Thomas White, a former Nebraska legislator and Omaha, Neb., lawyer who is representing the tribe.
Equally as important as the damage award the tribe wants is that the lawsuit seeks a ruling on how much beer Whiteclay retailers can sell, White said. This is the key to stopping beer trafficking at Pine Ridge.
"We are not saying you can't sell beer," White said. But he points to the large amount of beer sold in Whiteclay in 2010 and says, "you cannot sell in volumes you know will be illegally transported and sold. You have to reduce sales to a responsible level."
The lawsuit alleges that beer makers and stores sold to Pine Ridge residents knowing they would smuggle the alcohol into the reservation to drink or resell. Beer makers supplied the stores with "volumes of beer far in excess of an amount that could be sold in compliance with the laws of the state of Nebraska," tribal officials allege in the lawsuit.
Most of Whiteclay's beer store customers have no legal place to drink alcohol because it's banned on the reservation, state law prohibits drinking outside the stores and the nearest town that allows alcohol is 20 miles south, said Mark Vasina, president of the group Nebraskans for Peace.
Owners of the four beer stores in Whiteclay were unavailable or declined comment Thursday when The Associated Press contacted them. A spokeswoman for Anheuser-Busch InBev Worldwide said she was not yet aware of the lawsuit, and the other four companies being sued did not immediately return messages.
The lawsuit's defendants include the distributors and brewers and Whiteclay retail outlets because those higher up the sales and distribution chain exert pressure to maximize beer sales, White said. In hearings before the Nebraska Legislature in the past, distributors have argued their contracts with brewers require them to sell all the beer they are supplied.
"If the brewers say that to their distributors, then they all deserve it," White said of including brewers in the lawsuit. "These guys have an obligation to control their distributors."
Frank Pommersheim, a University of South Dakota law professor, is not sure the federal government can oversee the way Nebraska regulates beer sales.
"There is no doubt of the incredible harm caused by the actions in Whiteclay," Pommersheim said. "The question is whether that translates into an actionable claim of federal jurisdiction."
The tribe sees the lawsuit as a last resort after numerous failed attempts to deal with the abuse through protests and public pressure on lawmakers. Oglala Sioux President John Yellow Bird Steele said the tribal council authorized the lawsuit in an effort to protect the reservation's youth.
"Like American parents everywhere, we will do everything lawful we can to protect the health, welfare and future of our children," he said.
Nebraska lawmakers have struggled for years to curb the problem and are considering legislation this year that would allow the state to limit the types of alcohol sold in areas such as Whiteclay. The measure would require local authorities to ask the state to designate the area an "alcohol impact zone."
Nebraska's liquor commission then could limit the hours alcohol sellers are open, ban the sale of certain products or impose other restrictions.
Thomas Horton, a USD law professor who has a lengthy career litigating federal antitrust and civil cases, said the tribe's case could have national significance.
And Horton knows the beer business. "I was the lead attorney on the Miller-Coors merger," he said.
"This sounds like a very interesting lawsuit that is going to have some legs," Horton said. "I would think the tribe's jurisdiction over alcohol sales is protected, and this sounds like a scheme to circumvent that.
"I imagine this is going to be a spectacular battle."

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