It has been some 75 years since gangster Al Capone got into trouble for bootlegging illegal spirits during Prohibition.
Now, Utah officials are going after another Chicagoan. Businessman Louis Amoroso is facing charges of racketeering, tax evasion and illegally conducting certain business in Utah.The criminal charges are all related to what the state says were illegal sales of alcohol.
Actually, the charges stem from Amoroso's mail-order business, Beer Across America, which sells rare microbrew beers to some 100,000 beer connoisseurs nationwide, including some in Utah.
Amoroso admits he is a small-time distributor of hard-to-find brews, but he's certainly no Al Capone. He doesn't hang around swank speakeasies, does not have a cadre of beefy bodyguards and does not appear anywhere on the FBI's Most Wanted list.
Nevertheless, Amoroso found himself crossways with Utah prosecutors who have become the first in any state to file criminal charges for direct-mail shipments of micro-brews.
"Everyone at our end thinks the state's action was hostile and extreme," said Molly Schaeffer, spokeswoman for Amoroso's company, which also sells wine, cigars and coffee by mail. "We tried to negotiate with the state, and when that failed, we ceased shipping any products to Utah."
Amoroso says he has cooperated with state officials since they informed him in April 1996 that direct distribution to Utah customers was in violation of state liquor laws that specify only the state and its authorized outlets can sell liquor, wine or beer with an alcohol content greater than 3.2 percent.
Assistant attorney general Wayne Klein declined to comment on the case. A pretrial hearing on motions to dismiss the charges is scheduled for Tuesday.
As part of the negotiations, Amoroso agreed to stop accepting new member subscriptions from Utah residents, though it continued to fill outstanding orders to Utahns. Effective Dec. 2, the company discontinued shipping alcohol products to Utah in compliance with the state's demand.
End of the problem? Not hardly. In February, the state filed the criminal charges.
More foreboding for Amoroso, the state is alleging the violation of state liquor laws constitutes racketeering. Under racketeering laws, the state can confiscate businesses, vehicles and any personal property believed to have been used in the course of an ongoing criminal enterprise. And Amoroso could be sent to prison for up to 15 years.
The case has raised eyebrows across the nation, not because Amoroso's ability to sell fine brews may have been infringed, but because of the interstate ramifications of marketing products over the Internet and whether states can tax and regulate business activities originating in another state.
According to Earl Dorius, manager of the licensing and compliance section for the Department of Alcoholic Beverage Control, Utah is not alone in its campaign against mail-order companies that distribute beer and wine directly to consumers. Several states have enacted tough new laws to prohibit such direct distribution.
"The other states are watching closely to what happens here in Utah," Dorius said. "It's not just beer. There are lot of small wineries, boutique wineries, that are marketing directly to consumers, and states are concerned."
Of major concern to all of the states is that direct-mail distribution bypasses state alcohol regulators, thereby avoiding state taxes. In Utah, the state has a mandatory 61 percent markup on all distilled spirits, wines and heavy beers.
"Even in states that do not regulate as closely as Utah, a lot of the concern is money," Dorius said. " In Utah, we have chosen to closely and carefully regulate consumption and distribution channels, and (direct mail) triggers a whole lot of state concerns, revenue loss being one."
The original charges included four misdemeanor counts for illegally selling, distributing and importing alcoholic beverages, two felony counts for tax evasion, and one felony count of racketeering.
The tax evasion charges were dropped, Amoroso said, because he had collected and remitted all appropriate Illinois taxes where the company is licensed to do business. Klein refused to say why the charges were dropped.
Greg Shirf, owner of Shirf Brewing and maker of the Utah-made Wasatch brand of microbrews, is disturbed by the state's criminal prosecution, calling it "an overzealous and inappropriate approach" given the state has numerous civil and administrative remedies to resolve liquor violations.
Most Beer Across America customers are males in their late 20s to early 50s with an annual income of about $70,000 who "are not out to drink a 12-pack of beer and get drunk, but who are drinking for quality, drinking for the luxury of it," Amoroso said.
Customers receive by mail two six packs per month of different ales brewed by small brewers around the nation. At $12 per six pack, the price is about double what microbrews cost locally.
Amoroso started Beer Across America in 1992 as a way to allow beer connoisseurs to purchase brews that are not available in all or even most markets.
But as Al Capone learned, the tax man can be an awfully tough customer when it comes to alcohol.