Busted Like An Underage Keg Party

Whole Foods got busted by the state for its landlocked wine store in the basement of the Time Warner Center. The Times explains:

Whole Foods Market has closed the wine shop in its store in the lower level of the Time Warner Center on Columbus Circle after pleading no contest to charges from state liquor officials that it was illegally operating it in a grocery store.

Citing state law that requires wine and liquor stores to have a separate entrance at street level and prohibits them from selling food, the Division of Alcoholic Beverage Control fined Whole Foods $5,000 on April 7 and gave it 30 days to sell off its stock. Whole Foods closed the shop on May 9 and surrendered its liquor license to the agency.

Keep in mind that other more sensible states allow grocery stores not only to sell wine but hard liquor as well! And don’t forget that New York State didn’t even have Sunday sales until last September.

Whole Foods plans to use their liquor license to open up a store (with a separate entrance) on Houston Street. Local merchants are unhappy:

David Lannon, Whole Foods’s Northeast regional president, said the company expected to transfer and use the surrendered license again for a wine shop occupying 4,000 to 5,000 square feet of space in the blocklong supermarket it planned to open on East Houston Street next year. State law also prohibits holders of retail liquor licenses from owning more than one store. The East Houston Street wine shop will be separate from the supermarket there, with an entrance on Chrystie Street.

Several owners of wine and liquor shops near the planned Whole Foods have asked Community Board 3 to oppose the shop before the alcohol agency. Alan Jay Gerson, the neighborhood’s City Council member, said he also opposed the shop.

But hey, I’m all for competition — just not this kind of competition:

Anthony White, an owner of Discovery Wines at 10 Avenue A, said Whole Foods’s buying power gave it an unfair advantage. “Competition is fine, but we’re not happy about the way they can underprice us,” Mr. White said. “We’re buying cases and they’re buying pallets.”