Liquor License Risks in Light of COVID-19 Rules

Bilzin Sumberg

Bilzin Sumberg

With positive cases of the novel coronavirus on the rise, the State of Florida is cracking down on violations of COVID-19 rules through its Department of Business and Professional Regulation (DBPR). The DBPR is going after bars and restaurants that fail to enforce social distancing requirements and the wearing of face masks by suspending or revoking their liquor licenses. 

Earlier this month, Governor DeSantis focused heavily on loosening restrictions. Executive Order 20-139, issued by the Governor on June 3, provided guidelines that allowed restaurants and bars to operate at 50% of their indoor capacity with seated service. However, when violations observed at The Knight's Pub near the University of Central Florida on June 5th and 6th resulted in 13 employees and at least 28 customers testing positive for the coronavirus, the DBPR suspended the business’s liquor license indefinitely. By Friday, in the face of continued violations and nearly 9,000 new cases reported in Florida in a single day, the DBPR issued executive order 2020-09, which prohibits the sale of alcohol for consumption on premises in bars or any establishment that derives more than 50% of gross revenue from the sale of alcoholic beverages.        

According to Governor DeSantis, food and beverage establishments should expect continued visits from DBPR inspectors. After a warning, those not following the guidelines aimed at preventing the spread of the virus will lose their liquor licenses. The DBPR is reportedly working with sheriffs around the State, and personnel from the DBPR's Division of Alcoholic Beverages and Tobacco have already begun conducting nightly inspections. 

This decision represents a shift in the State's enforcement efforts, which had previously been delegated to local authorities, and is likely due in part to the fact that reported cases in Florida surged past 122,000 on Friday. Several municipalities throughout Miami-Dade County have now mandated the wearing of face masks in public at all times. In addition to threats of fines and jail time, Miami-Dade County also said businesses closed for noncompliance must attest in writing that they completed remedial steps before they are permitted to reopen.

While suspending or revoking liquor licenses can be an effective tool in enforcing state-issued guidelines, there are concerns that doing so reduces tax revenue for the State and may lead to legal battles. Most businesses are already struggling with the cost and confusion of complying with new local and state regulations and dealing with non-compliant customers. Many of those businesses are voluntarily shuttering their doors and returning to take-out-only service to avoid violations. Businesses keeping their doors open for seated service should remain vigilant in the wake of increased enforcement.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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