Oklahoma 2023 Regular Session

Oklahoma Senate Bill SB422 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1
2	2
3		-	ENGR. H. A. to ENGR. S. B. NO. 422 Page 1 1
	3	+	SB422 HFLR Page 1
	4	+	BOLD FACE denotes Committee Amendments. 1
4	5		2
5	6		3
6	7		4
7	8		5
8	9		6
9	10		7
10	11		8
11	12		9
12	13		10
13	14		11
14	15		12
15	16		13
16	17		14
17	18		15
18	19		16
19	20		17
20	21		18
21	22		19
22	23		20
23	24		21
24	25		22
25	26		23
26	27		24
27	28
28		-	ENGROSSED HOUSE AMENDME NT
29		-	TO
30		-	ENGROSSED SENATE BILL NO . 422 By: Coleman of the Senate
	29	+	HOUSE OF REPRESENTATIVES - FLOOR VERSION
31	30
32		-	~~and~~
	31	+	STATE OF OKLAHOMA
33	32
34		-	Marti of the House
35		-
36		-
37		-
38		-
39		-
40		-	[ alcoholic beverages - agreement - provisions -
41		-	remedy of noncompliance - interest - conditions -
42		-	renegotiation - damages - compensation - effective
43		-	date ]
44		-
45		-
46		-
47		-
48		-
49		-
50		-	AMENDMENT NO. 1. Page 1, Line 10, strike the enacting clause
51		-
52		-	Passed the House of Representatives the 27th day of April, 2023.
53		-
54		-
55		-
56		-
57		-
58		-	Presiding Officer of the House of
59		-	Representatives
60		-
61		-
62		-	Passed the Senate the ____ day of __________, 2023.
63		-
64		-
65		-
66		-
67		-
68		-	Presiding Officer of the Senate
69		-
70		-
71		-	ENGR. S. B. NO. 422 Page 1 1
72		-	2
73		-	3
74		-	4
75		-	5
76		-	6
77		-	7
78		-	8
79		-	9
80		-	10
81		-	11
82		-	12
83		-	13
84		-	14
85		-	15
86		-	16
87		-	17
88		-	18
89		-	19
90		-	20
91		-	21
92		-	22
93		-	23
94		-	24
	33	+	1st Session of the 59th Legislature (2023)
95	34
96	35		ENGROSSED SENATE
97	36		BILL NO. 422 By: Coleman of the Senate
98	37
99	38		and
100	39
101	40		Marti of the House
102	41
103	42
104	43
105	44
106	45		[ alcoholic beverages - agreement - provisions -
107	46		remedy of noncompliance - interest - conditions -
108	47		renegotiation - damages - compensation - effective
109	48		date ]
110	49
111	50
112	51
113	52
114	53		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
115	54		SECTION 1. AMENDATORY 37A O.S. 2021, Section 3 -111, is
116	55		amended to read as fo llows:
117	56		Section 3-111. A. Except as provided in subsection F of this
118	57		section, a small brewer, who manufactures less than twenty -five
119	58		thousand (25,000) barrels of beer annually, is not subject to the
120	59		termination provisions of this section.
121	60		B. 1. Except as provided in subsections C, D and E subsection
122	61		C of this section, no brewer shall termi nate a distributor agreement
123		-	with any beer distributor without establishing good cause for such
124		-	termination and unless all of the following occur:
125		-	a. the brewer establishes g ood cause for such
126		-	termination,
127		-	b. the beer distributor receives written notificat ion by
128		-	certified mail, return receipt requested, from the
129	62
130		-	ENGR. S. B. NO. 422 Page 2 1
	63	+	SB422 HFLR Page 2
	64	+	BOLD FACE denotes Committee Amendments. 1
131	65		2
132	66		3
133	67		4
134	68		5
135	69		6
136	70		7
137	71		8
138	72		9
139	73		10
140	74		11
141	75		12
142	76		13
143	77		14
144	78		15
145	79		16
146	80		17
147	81		18
148	82		19
149	83		20
150	84		21
151	85		22
152	86		23
153	87		24
154	88
	89	+	with any beer distributor without establishing good cause for such
	90	+	termination and unless all of the following occur:
	91	+	a. the brewer establishes good cause for such
	92	+	termination,
	93	+	b. the beer distributor receives written notificat ion by
	94	+	certified mail, return receipt requested, from the
155	95		brewer of the alleged noncompliance and is afforded no
156	96		less than sixty (60) ninety (90) days in which to cure
157	97		such noncompliance. If not capable of being cured
158	98		within the sixty-day ninety-day period, the beer
159	99		distributor shall begin the cure within the sixty-day
160	100		ninety-day period and diligently pursue the cure as
161	101		promptly as feasible,
162	102		c. b. the beer distributor f ails to cure such noncompliance
163	103		within the allotted cure period, and
164	104		d. c. the brewer provides written notice by certified mail,
165	105		return receipt requested, to the beer distributor of
166	106		such continued noncompliance. The notification shall
167	107		contain a statement of the intention of the brewer to
168	108		terminate the distributor agreement, the reasons f or
169	109		the termination and the date the termination shall
170	110		take effect.
171	111		2. If a beer distributor cures an alleged noncompliance within
172	112		the cure period provided in subparagraph b a of paragraph 1 of this
173		-	subsection, any notice of termination from a brewer to a beer
174		-	distributor shall be null and void.
175		-	C. A brewer may immediately terminate a distributor agreement,
176		-	effective upon furnishing written notification to the beer
177		-	distributor by certified mail, return receip t requested, for any of
178		-	the following reasons:
179	113
180		-	ENGR. S. B. NO. 422 Page 3 1
	114	+	SB422 HFLR Page 3
	115	+	BOLD FACE denotes Committee Amendments. 1
181	116		2
182	117		3
183	118		4
184	119		5
185	120		6
186	121		7
187	122		8
188	123		9
189	124		10
190	125		11
191	126		12
192	127		13
193	128		14
194	129		15
195	130		16
196	131		17
197	132		18
198	133		19
199	134		20
200	135		21
201	136		22
202	137		23
203	138		24
204	139
	140	+	subsection, any notice of termination from a brewer to a beer
	141	+	distributor shall be null and void.
	142	+	C. A brewer may immediately terminate a distributor agreement,
	143	+	effective upon furnishing written notification to the beer
	144	+	distributor by certified mail, return receip t requested, for any of
	145	+	the following reasons:
205	146		1. The beer distributor’s failure to pay any undisputed account
206	147		when due and upon written demand by the brewer for such payment, in
207	148		accordance with agreed payment terms;
208	149		2. The assignment or attempted assign ment by the beer
209	150		distributor for the benefit of cred itors, the institution of
210	151		proceedings in bankruptcy by or against the beer distributor, the
211	152		dissolution or liquidation of the beer distributor or the insolvency
212	153		of the beer distributor;
213	154		3. The revocation or suspension of, or the failure to renew for
214	155		a period of more than fourteen (14) thirty-one (31) days, a beer
215	156		distributor’s state, local or federal license or permit to sell beer
216	157		in this state;
217	158		4. The beer distributor has been convicted of a felony that , in
218	159		the brewer’s sole judgment, adversely affects t he goodwill of the
219	160		beer distributor or brewer ; provided, however, an existing
220	161		stockholder or stockholders, partner or partners, or member or
221	162		members shall have the right to purchase the stock, partnershi p
222	163		interest, or membership interest of the offending s tockholder,
223		-	partner, or member prior to the conviction of the offending
224		-	stockholder, partner, or member, and if the sale is completed prior
225		-	to conviction, the provisions of this paragraph shall not apply ;
226		-	5. A beer distributor has been convicted of, found guilty of or
227		-	pled guilty or nolo contendere to, a charge of violating a law or
228		-	regulation of the United States or of this state if it materially
229	164
230		-	ENGR. S. B. NO. 422 Page 4 1
	165	+	SB422 HFLR Page 4
	166	+	BOLD FACE denotes Committee Amendments. 1
231	167		2
232	168		3
233	169		4
234	170		5
235	171		6
236	172		7
237	173		8
238	174		9
239	175		10
240	176		11
241	177		12
242	178		13
243	179		14
244	180		15
245	181		16
246	182		17
247	183		18
248	184		19
249	185		20
250	186		21
251	187		22
252	188		23
253	189		24
254	190
	191	+	partner, or member prior to the conviction of the offending
	192	+	stockholder, partner, or member, and if the sale is completed prior
	193	+	to conviction, the provision s of this paragraph shall not apply ;
	194	+	5. A beer distributor has been convicted of, found guilty of or
	195	+	pled guilty or nolo contendere to, a charge of violating a law or
	196	+	regulation of the United States or of this state if it materially
255	197		and adversely affects the ability of the beer distributor or brewer
256	198		to continue to sell its beer in this state ;
257	199		6. Any attempted transfer of at least fifty percent (50%)
258	200		ownership of the beer distributor, stock of the beer distributor or
259	201		stock of any parent corporation of the beer distributor, or any
260	202		change in more than fifty percent (50%) of the beneficial ownership
261	203		or control of any entity having control of the beer distributor,
262	204		without obtaining the prior written approval of the brewer, which
263	205		may not be unreasonably withheld , except as may otherwise be
264	206		permitted pursuant to a written agreement betw een the parties;
265	207		7. Fraudulent conduct made with the express , prior knowledge of
266	208		the ownership and management of the beer distributor in the beer
267	209		distributor’s dealings with the br ewer of beer, including the
268	210		intentional sale of beer outside the brewer ’s established quality
269	211		standards;
270	212		8. Cessation of the beer distributor to conduct business for
271	213		five (5) consecutive business days, unless conducting the business
272	214		is prevented or render ed impractical due to events beyond the
273		-	distributor’s reasonable control as a result of an act of God, an
274		-	insured casualty, war or a condition of national, state or local
275		-	emergency; or
276		-	9. Any material and repeated sale of beer, directly or
277		-	indirectly, to custo mers located outside the terri tory assigned to
278		-	the beer distributor by the brewer made with the express, prior
279	215
280		-	ENGR. S. B. NO. 422 Page 5 1
	216	+	SB422 HFLR Page 5
	217	+	BOLD FACE denotes Committee Amendments. 1
281	218		2
282	219		3
283	220		4
284	221		5
285	222		6
286	223		7
287	224		8
288	225		9
289	226		10
290	227		11
291	228		12
292	229		13
293	230		14
294	231		15
295	232		16
296	233		17
297	234		18
298	235		19
299	236		20
300	237		21
301	238		22
302	239		23
303	240		24
304	241
	242	+	distributor’s reasonable control as a result of an act of God, an
	243	+	insured casualty, war or a condition of national, state or local
	244	+	emergency; or
	245	+	9. Any material and repeated sale of beer, directly or
	246	+	indirectly, to customers located outside the terri tory assigned to
	247	+	the beer distributor by the brewer made with the express, prior
305	248		knowledge of the ownership and management of the beer distributor
306	249		unless expressly authorized by the brewer.
307	250		Provided, the D. Any beer distributor terminated by a brewer
308	251		under subsection B or C of this section shall have the opportunity
309	252		to sell the brewer’s brands for one hundred twenty (120) days after
310	253		termination in accordance with the distributor agreement .
311	254		Additionally, the brewer shall pay the beer distributor the fair
312	255		market value of the distribution rights , which may be lost or
313	256		diminished by reason of the termination. If the beer distributor
314	257		disputes that the payment made by the brewer was the fair market
315	258		value of the distribution rights, the beer distributor may submit
316	259		the question of fair market value to binding arbitr ation in
317	260		accordance with the procedures set for th in paragraphs 3 through 6
318	261		of subsection F of this subsection.
319	262		D. The brewer shall have the right to terminate an agre ement
320	263		with a beer distributor at an y time by giving the beer distributor
321	264		at least ninety-days’ written notice by certified mail, return
322	265		receipt requested; provided, the brewer shall give a similar notice
323		-	to all other beer distributors in all other states who ha ve entered
324		-	into the same distributor agreement with the brewer.
325		-	E. If a particular brand of beer is transferred by purchase or
326		-	otherwise from a brewer to a successor brewer , the following shall
327		-	occur:
328	266
329		-	ENGR. S. B. NO. 422 Page 6 1
	267	+	SB422 HFLR Page 6
	268	+	BOLD FACE denotes Committee Amendments. 1
330	269		2
331	270		3
332	271		4
333	272		5
334	273		6
335	274		7
336	275		8
337	276		9
338	277		10
339	278		11
340	279		12
341	280		13
342	281		14
343	282		15
344	283		16
345	284		17
346	285		18
347	286		19
348	287		20
349	288		21
350	289		22
351	290		23
352	291		24
353	292
	293	+	to all other beer distributors in all other states w ho have entered
	294	+	into the same distributor agreement with the brewer.
	295	+	E. If a particular brand of beer is transferred by purchase or
	296	+	otherwise from a brewer to a successor brewer , the following shall
	297	+	occur:
354	298		1. The the successor brewer shall become obligat ed to all of
355	299		the terms and conditio ns of the existing distributor agreement in
356	300		effect on the date of succession. This subsection applies
357	301		regardless of the character or form of the succession. A successor
358	302		brewer has the right to contractually require its beer distributor
359	303		to comply with commercially reasonable operational standards of
360	304		performance, if the standards are uniformly established for all of
361	305		the successor brewer ’s distributors. A successor brewer may, upon
362	306		written notice, terminate its agreement, in whole or in part, with a
363	307		beer distributor of the brewer it succeeded, for t he purpose of
364	308		transferring the distribution rights in the beer distributor ’s
365	309		territory to a new beer distributor, provided that the successor
366	310		beer distributor first pays to the e xisting beer distributor the
367	311		fair market value of the existing distributor ’s business with
368	312		respect to the terminated brand or brands;
369	313		2. If the successor brewer decides to terminate its agreement
370	314		with the existing beer distributor for purposes of transfer , the
371	315		successor brewer shall notify the existing beer distributor in
372	316		writing of the successor brewer’s intent not to appoint the existing
373		-	beer distributor for all or part of the existing beer distributor ’s
374		-	territory. The successor brewer shall mail the notice of
375		-	termination by certified ma il, return receipt requested, to the
376		-	existing beer distributor. The successor brewer shall include in
377	317
378		-	ENGR. S. B. NO. 422 Page 7 1
	318	+	SB422 HFLR Page 7
	319	+	BOLD FACE denotes Committee Amendments. 1
379	320		2
380	321		3
381	322		4
382	323		5
383	324		6
384	325		7
385	326		8
386	327		9
387	328		10
388	329		11
389	330		12
390	331		13
391	332		14
392	333		15
393	334		16
394	335		17
395	336		18
396	337		19
397	338		20
398	339		21
399	340		22
400	341		23
401	342		24
402	343
	344	+	beer distributor for all or part of the existing beer distributor ’s
	345	+	territory. The successor brewer shall mail the no tice of
	346	+	termination by certified ma il, return receipt requested, to the
	347	+	existing beer distributor. The successor brewer shall include in
403	348		the notice the names, addresses and telephone numbers of the
404	349		successor beer distributor or distributors;
405	350		3. a. the successor beer distributor shall negot iate with
406	351		the existing beer distributor to determine the fair
407	352		market value of the existing beer distributor ’s right
408	353		to distribute in the existing beer distributor ’s
409	354		territory. The successor beer distributor and the
410	355		existing beer distributor shall negotiat e the fair
411	356		market value in good faith, and
412	357		b. the existing beer distributor shall continue to
413	358		distribute in good faith until payment of the
414	359		compensation agreed to under subparagraph a of this
415	360		paragraph, or awarded under p aragraph 4 of this
416	361		subsection, is received; and
417	362		4. a. if the successor beer distributor and the existing
418	363		beer distributor fail to reach a written agreement on
419	364		the fair market value within thirty (30) days after
420	365		the existing beer distributor receives the no tice
421	366		required pursuant to paragraph 2 of this subsection,
422	367		the successor beer distributor or the existing beer
423		-	distributor shall send a written notice to the other
424		-	party requesting arbitration pursuant to the Uniform
425		-	Arbitration Act, Part 2 of Article 22 of Titl e 13,
426		-	C.R.S. Arbitration shall be held for the purpose of
427	368
428		-	ENGR. S. B. NO. 422 Page 8 1
	369	+	SB422 HFLR Page 8
	370	+	BOLD FACE denotes Committee Amendments. 1
429	371		2
430	372		3
431	373		4
432	374		5
433	375		6
434	376		7
435	377		8
436	378		9
437	379		10
438	380		11
439	381		12
440	382		13
441	383		14
442	384		15
443	385		16
444	386		17
445	387		18
446	388		19
447	389		20
448	390		21
449	391		22
450	392		23
451	393		24
452	394
	395	+	distributor shall send a written notice to the other
	396	+	party requesting arbitration pursuant to the Uniform
	397	+	Arbitration Act, Part 2 of Article 22 of Title 13,
	398	+	C.R.S. Arbitration shall be held for the purpose of
453	399		determining the fair mark et value of the existing beer
454	400		distributor’s right to distribute in the existing beer
455	401		distributor territory,
456	402		b. notice of intent to arbitrate shall be sent, as
457	403		provided in subparagraph a of this paragraph , not
458	404		later than forty (40) days after the existing b eer
459	405		distributor receives the notice required pursuant to
460	406		paragraph 2 of this subsection. The arbitration
461	407		proceeding shall conclude not later than sixty (60)
462	408		days after the date the notice of intent to a rbitrate
463	409		is mailed to a party, unless this time is ex tended by
464	410		mutual agreement of the parties and the arbitrator,
465	411		c. any arbitration held pursuant to this subsection shall
466	412		be conducted in a city within this state that:
467	413		(1) is closest to the existing beer distributor, and
468	414		(2) has a population of more than tw enty thousand
469	415		(20,000) people,
470	416		d. any arbitration held pursuant to this paragraph shall
471	417		be conducted before one impartial arbitrator to be
472	418		selected by the American Arbi tration Association or
473		-	its successor. The arbitration shall be conducted in
474		-	accordance with the rules and procedures of the
475		-	Uniform Arbitration Act, Part 2 of Article 22 of Title
476		-	13, C.R.S.,
477	419
478		-	ENGR. S. B. NO. 422 Page 9 1
	420	+	SB422 HFLR Page 9
	421	+	BOLD FACE denotes Committee Amendments. 1
479	422		2
480	423		3
481	424		4
482	425		5
483	426		6
484	427		7
485	428		8
486	429		9
487	430		10
488	431		11
489	432		12
490	433		13
491	434		14
492	435		15
493	436		16
494	437		17
495	438		18
496	439		19
497	440		20
498	441		21
499	442		22
500	443		23
501	444		24
502	445
	446	+	its successor. The arbitration shall be conducted in
	447	+	accordance with the rules and procedures of the
	448	+	Uniform Arbitration Act, Part 2 of Article 22 of Title
	449	+	13, C.R.S.,
503	450		e. an arbitrator’s award in any arbitration held pursuant
504	451		to this paragraph shall be monetary only and shall not
505	452		enjoin or compel conduct. Any arbitrat ion held
506	453		pursuant to this paragraph shall be in lieu of all
507	454		other remedies and procedures,
508	455		f. the cost of the arbitrator and any other direct costs
509	456		of an arbitration he ld pursuant to this paragraph
510	457		shall be equally divided by the parties engaged in the
511	458		arbitration. All other costs shall be paid by the
512	459		party incurring them,
513	460		g. the arbitrator in any arbitration held pursuant to
514	461		this paragraph shall render a written decisi on not
515	462		later than thirty (30) days after the conclusion of
516	463		the arbitration, unless this time is extended by
517	464		mutual agreement of the parties and the arbitrator.
518	465		The decision of the arbitrator is final and binding on
519	466		the parties. The arbitrator ’s award may be enforced
520	467		by commencing a civil action in any court of competent
521	468		jurisdiction. Under no circumstances may the parties
522	469		appeal the decision of the arbitrator,
523		-	h. an existing beer distributor or successor beer
524		-	distributor who fails to participate in the
525		-	arbitration hearings in any arbitrat ion held pursuant
526		-	to this paragraph waives all rights the existing beer
527	470
528		-	ENGR. S. B. NO. 422 Page 10 1
	471	+	SB422 HFLR Page 10
	472	+	BOLD FACE denotes Committee Amendments. 1
529	473		2
530	474		3
531	475		4
532	476		5
533	477		6
534	478		7
535	479		8
536	480		9
537	481		10
538	482		11
539	483		12
540	484		13
541	485		14
542	486		15
543	487		16
544	488		17
545	489		18
546	490		19
547	491		20
548	492		21
549	493		22
550	494		23
551	495		24
552	496
	497	+	h. an existing beer distributor or successor beer
	498	+	distributor who fails to participate in the
	499	+	arbitration hearings in any arbitrat ion held pursuant
	500	+	to this paragraph waives all rights the existing beer
553	501		distributor or successor beer distributor would have
554	502		had in the arbitration and is considered to ha ve
555	503		consented to the determination of the arbitrato r, and
556	504		i. if the existing beer dist ributor does not receive
557	505		payment from the successor b eer distributor of the
558	506		settlement or arbitration award required under
559	507		paragraph 2 or 3 of this subsection within thirt y (30)
560	508		days after the date of the settlement or ar bitration
561	509		award:
562	510		(1) the existing beer distributor shall remain the
563	511		beer distributor in the existing beer
564	512		distributor’s territory to at least the same
565	513		extent that the existing beer distributor
566	514		distributed the beer immediately before the
567	515		successor brewer acquired rights to the brand,
568	516		and
569	517		(2) the existing beer distributor is not entitled to
570	518		the settlement or arbitration award.
571	519		F. 1. In addition to termination rights that may be set forth
572	520		in a distributor agreement, a small brewer who manufactures less
573		-	than twenty-five thousand barrels of bee r annually may terminate a
574		-	distributor agreement with any beer distributor provided that, prior
575		-	to the effective date of the termination, the small brewer pays the
576	521
577		-	ENGR. S. B. NO. 422 Page 11 1
	522	+	SB422 HFLR Page 11
	523	+	BOLD FACE denotes Committee Amendments. 1
578	524		2
579	525		3
580	526		4
581	527		5
582	528		6
583	529		7
584	530		8
585	531		9
586	532		10
587	533		11
588	534		12
589	535		13
590	536		14
591	537		15
592	538		16
593	539		17
594	540		18
595	541		19
596	542		20
597	543		21
598	544		22
599	545		23
600	546		24
601	547
	548	+	than twenty-five thousand barrels of bee r annually may terminate a
	549	+	distributor agreement with any beer distributor provided that, prior
	550	+	to the effective date of the termination, the small brewer pays the
602	551		beer distributor the fair market value of the distributio n rights
603	552		which will be lost or dimi nished by reason of the termination.
604	553		2. If such small brewer and beer distributor cannot mutually
605	554		agree to the fair market value of the applicable distribution rights
606	555		lost or diminished by reason of the termination, then the brewer
607	556		shall pay the beer dist ributor a good faith estimate of the fair
608	557		market value of the applicable distribution rights.
609	558		3. If the beer distributor being terminated under paragraph 2
610	559		of this subsection disputes that the payment made by the small
611	560		brewer was less than the fair market value of the distribution
612	561		rights, then the beer dist ributor may within forty-five (45) days of
613	562		termination submit the question of fair market value of the
614	563		applicable distribution rights lost or diminished by reason of th e
615	564		termination to binding arbitratio n before a panel of three neutral
616	565		arbitrators appointed in accordance with the commercial arbitration
617	566		rules of the American Arbitration Association, which panel shall
618	567		determine by majority decision whether the small brewe r’s payment
619	568		meets the requirements of paragraph 2 of this subsection.
620	569		4. If the arbitration panel rules that the payment made by the
621	570		small brewer to the beer distributor upon termination was less than
622	571		the fair market value of distribution rights lost or d iminished by
623		-	reason of the terminat ion, then the small brewer must pay the beer
624		-	distributor the difference between the payment made to the beer
625		-	distributor and the determined fair market value plus inter est.
626	572
627		-	ENGR. S. B. NO. 422 Page 12 1
	573	+	SB422 HFLR Page 12
	574	+	BOLD FACE denotes Committee Amendments. 1
628	575		2
629	576		3
630	577		4
631	578		5
632	579		6
633	580		7
634	581		8
635	582		9
636	583		10
637	584		11
638	585		12
639	586		13
640	587		14
641	588		15
642	589		16
643	590		17
644	591		18
645	592		19
646	593		20
647	594		21
648	595		22
649	596		23
650	597		24
651	598
	599	+	reason of the terminat ion, then the small brewer must pay the beer
	600	+	distributor the difference between the payment made to the beer
	601	+	distributor and the determined fair market value plus inter est.
652	602		5. If the arbitration panel rules that the paym ent made by the
653	603		small brewer to the beer distributor upon termination was more than
654	604		the fair market value of distribution rights lost or diminished by
655	605		reason of the termination, then the beer distributor must pay the
656	606		small brewer the difference between the payment made to the beer
657	607		distributor and the determined fair market value, plus interes t.
658	608		6. All arbitration fees and expenses shall be equally divided
659	609		among the parties to the arbitration, except if t he arbitration
660	610		panel determines that the small brewer ’s payment upon termination
661	611		was not a good-faith estimate of the fair market value, then the
662	612		panel may award up to shall order that one hundred percent (100%) of
663	613		the arbitration costs to be paid by the small brewer.
664	614		G. 1. Any beer distributor or brewer w ho is aggrieved by a
665	615		violation of any provision of subsections B and D C of this section
666	616		shall be entitled to recovery of damages caused by the violation ,
667	617		including an improper termination by a br ewer, which damages shall
668	618		include the fair market value of t he distribution rights if the beer
669	619		distributor is improperly terminated by the br ewer. Except for a
670	620		dispute arising under subsectio n E of this section, damages Damages
671	621		shall be sought in a civil action in any court of competent
672	622		jurisdiction.
673		-	2. Any dispute arising under subsections B and D C of this
674		-	section may also be settled by such dispu te resolution procedures as
675		-	may be provided by a written agreement between the parties.
676	623
677		-	ENGR. S. B. NO. 422 Page 13 1
	624	+	SB422 HFLR Page 13
	625	+	BOLD FACE denotes Committee Amendments. 1
678	626		2
679	627		3
680	628		4
681	629		5
682	630		6
683	631		7
684	632		8
685	633		9
686	634		10
687	635		11
688	636		12
689	637		13
690	638		14
691	639		15
692	640		16
693	641		17
694	642		18
695	643		19
696	644		20
697	645		21
698	646		22
699	647		23
700	648		24
701	649
	650	+	2. Any dispute arising under subsections B and D C of this
	651	+	section may also be settled by such dispu te resolution procedures as
	652	+	may be provided by a written agreement between the parties.
702	653		H. Nothing in this section shall be construed to limit or
703	654		prohibit good-faith settlements voluntarily entered into by the
704	655		parties.
705	656		I. Nothing in this section shall be construed to give a beer
706	657		distributor any right to compensation if an agreement with the beer
707	658		distributor is terminated by a brewer pursuant to subsections B , C
708	659		and D of this section.
709	660		J. No brewer shall require any beer distributor to waive
710	661		compliance with any provision of the Oklahoma Alcoholic Beverage
711	662		Control Act and any provisions of a distributor agreement in
712	663		conflict with the provisions of the Oklahoma A lcoholic Beverage
713	664		Control Act shall be null a nd void.
714	665		K. J. No brewer shall charge or accept, and no beer distributor
715	666		shall pay or provide, in a material way, any money, property,
716	667		gratuity, rebate, free goods, shipping charges different than those
717	668		charged for all beer distributors, allowances, thing of value or
718	669		other inducement, as defined in Section 3-123 of this title, from a
719	670		beer distributor in exchange for the brewer entering into a
720	671		distributor agreement with the beer distributor. However, a brewer
721	672		who also holds a beer distributor license and d esires to sell all or
722	673		a portion of its beer distribut ion rights and business, or a holder
723		-	of small brewer license who desires to change its election from
724		-	self-distribution to the use of a distributor agreement may accept a
725	674
726		-	ENGR. S. B. NO. 422 Page 14 1
	675	+	SB422 HFLR Page 14
	676	+	BOLD FACE denotes Committee Amendments. 1
727	677		2
728	678		3
729	679		4
730	680		5
731	681		6
732	682		7
733	683		8
734	684		9
735	685		10
736	686		11
737	687		12
738	688		13
739	689		14
740	690		15
741	691		16
742	692		17
743	693		18
744	694		19
745	695		20
746	696		21
747	697		22
748	698		23
749	699		24
750	700
	701	+	of small brewer license who desires to change its election from
	702	+	self-distribution to the use of a distributor agreement may accept a
751	703		payment for the fair market value of its existing and established
752	704		distribution busines s in the subject territory.
753	705		L. K. This section shall apply to any agreement entered i nto
754	706		and any renewals, extensions, amendments or conduct constituting a
755	707		modification of a distributor agreement by a b rewer or cider
756	708		manufacturer existing on or after the effective date of this act
757	709		October 1, 2018.
758	710		M. L. Where a cider manufacturer distributes cider throug h a
759	711		beer distributor, the rights and obligations of the cider
760	712		manufacturer, the distributor, a successor cider manufacturer and a
761	713		successor distributor sh all be the same as the rights and
762	714		obligations provided in this section for a brewer, beer distributor,
763	715		successor brewer and successor beer distributor.
764	716		SECTION 2. This act shall become effective N ovember 1, 2023.
765		-	Passed the Senate the 14th day of March, 2023.
766	717
767		-
768		-
769		-	Presiding Officer of the Senate
770		-
771		-
772		-	Passed the House of Representatives the ____ day of __________,
773		-	2023.
774		-
775		-
776		-
777		-	Presiding Officer of the House
778		-	of Representatives
779		-
780		-
781		-	ENGR. S. B. NO. 422 Page 15 1
782		-	2
783		-	3
784		-	4
785		-	5
786		-	6
787		-	7
788		-	8
789		-	9
790		-	10
791		-	11
792		-	12
793		-	13
794		-	14
795		-	15
796		-	16
797		-	17
798		-	18
799		-	19
800		-	20
801		-	21
802		-	22
803		-	23
804		-	24
805		-
806		-
	718	+	COMMITTEE REPORT BY: COMMITTEE ON ALCOHOL, TOBACCO AND CONTROLLED
	719	+	SUBSTANCES, dated 04/12/2023 - DO PASS.