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'Free' wine kiosks cost Pennsylvania $300K in legal fees
Jan 27, 2015
(MCALL) - The Pennsylvania Liquor Control Board has spent almost $300,000 defending a claim by a Montgomery County company that supplied the supermarket wine kiosks before it was aborted because the machines were unpopular, a newspaper reported.
The legal fees were reported Sunday by the Pittsburgh Tribune-Review in a story updating the status of the litigation by Simple Brands LLC. The newspaper obtained the legal bills in a public records request.
The Conshohocken company is pursuing the matter before the LCB's Board of Claims in Harrisburg, saying the LCB essentially forced it out of business at a loss of $81 million. The company also says the LCB is delaying the litigation unnecessarily.
But LCB attorney Dean Piermattel said the company took six months to respond to the LCB's request for records, and last month produced more than 126,000 pages, which LCB attorneys are still reviewing.
"We want nothing more than to move this case along as expeditiously as possible, but we need information before we can proceed," Piermattel said in a statement released through an LCB spokeswoman.
Simple Brands contends that the LCB violated a contract to put 100 kiosks in stores across the state. The company said 32 kiosks that the company provided free of charge were placed in stores before the LCB shut down the program in 2011.
The machines offered more than 50 kinds of wine, but many didn't hit sales targets and the LCB contends they were unpopular with older customers.
LCB Chief Executive Officer Joe Conti has said the agency couldn't find locations for 100 kiosks, because the 10-foot-high machines, which held hundreds of bottles, were too big and heavy for some stores in rural areas.
Also, the machines, which were supposed to be convenient, alienated customers with technical glitches and a multistep process that required customers to blow into a device to prove they weren't drunk when purchasing wine, the LCB has argued.
But Alan Fellheimer, one of Simple Brands' attorneys, said the company was working on solutions when the program was dropped. He blamed the LCB for not following through and putting Simple Brands "out of business."
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