LITTLE ROCK — Rebuffed by state regulators, Arkansas liquor-store owners turned to Pulaski County Circuit Judge Alice Gray on Friday to try to stop Costco Wholesale from selling spirits when the big-box store opens next week.
The United Beverage Retailers of Arkansas and its president, Johnny Akins, filed court papers Friday asking the judge to block Costco’s liquor-sale permit and overturn the decision to license the store at 16901 Chenal Parkway to sell liquor such as vodka, whiskey and rum.
They have asked for an emergency hearing for the judge to impose a temporary injunction that would keep Costco from selling liquor. The $23.2 million store is scheduled to open Wednesday, across the street from Akins’ store, Legacy Wine and Spirits, 16900 Chenal Parkway.
Akins and the United Beverage group are appealing the June decision on Costco’s permit to circuit court. The 11-page appeal of the Arkansas Beverage Control Board decision by attorney Jimmy Simpson of Searcy states that the board directors broke the law to permit Costco, ignoring mandates on the number of retailers. Simpson, on behalf of United Beverage members, had spoken out against the permit at the June board meeting.
According to the appeal, Little Rock is ineligible for another liquor store. The city has 56 retailers licensed, which is 30 more than the law allows for a city of Little Rock’s size, with 20 of them within 6 miles of Costco.
The litigation also targets Costco’s business model, pointing out that while Arkansas liquor stores are barred from selling most of the kinds of products that Costco offers, the retail chain is getting around that rule by setting up a separate liquor store adjoined to its retail store, which puts Costco at an unfair advantage over its liquor-store competitors. Cost-co is licensed to sell beer and wine in its retail store.
The defendants in the appeal, along with Costco Wholesale, are Costco representative Nicholas Kelley, who obtained the permit; the Control Board, its director Doralee Chandler and the Arkansas Department of Finance and Administration, which oversees the board.
The permitting process for Costco has been contentious. In May, Chandler had rejected Costco’s permit application after state Sen. Kim Hammer, R-Benton, objected.
Chandler’s decision was overturned in June by the Control Board directors after Costco appealed. The store was allowed to assume the permit of Stagecoach Wine & Spirits.