LCB Defends Promotion, Questioned For Overstating Figures

OCEAN CITY — The Liquor Control Board for Worcester County (LCB) defended the liquor promotion that has sparked a new array of investigations and accusations against it in hopes of proving no law was broken.

Unfortunately for the LCB, the supplier who sold it the liquor shot a gaping hole in that defense when it said the numbers the LCB quoted were “severely overstated.”

As per Article 2B of Maryland State Law, the LCB must offer all licensees the same pricing for alcohol and they can’t sell a product for below cost unless the product in question has been discontinued.

In the instance of the March Stoli promotion that has sparked a controversy throughout Worcester County, three licensees claim to have paid three different prices on the same day and the promotion itself came into question when it was argued that selling a bottle of Stoli at $5 a bottle was far below cost, thus making it illegal from the start.

LCB Board member and spokesperson Larry Wilkinson provided the invoices from March 31, 2010, the last day of the promotion, which shows when the vodka was delivered to the LCB’s Snow Hill headquarters from the supplier William Grant & Sons.

The total invoice was for 4,236 bottles of Stoli at $17.17 (gross cost per bottle) or $72,699.08. However, after a massive depletion allowance/promotional credit of $52,663.98 was allegedly given back to the LCB, according to a summary of the transaction prepared by the LCB, the net cost for the LCB stood at $20,035.10 or $4.73 per bottle.

These numbers would affirm the LCB’s claim that it knew the numbers and didn’t violate any of the laws by setting the price at $5, which is still technically above the $4.73 a bottle that they quoted.

However, William Grant & Sons spokesperson James Curich, who said last week the company had no knowledge of the $5 promotion, said the more than $52,000 in depletion allowances was incorrect.

“That number that they are quoting for a depletion allowance is severely overstated, said Curich via phone interview yesterday afternoon. “Our records show that we paid them significantly less than what they are projecting. In fact, it was less than $10,000.”

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