To Serve and Protect: Dram Shop Law and the Problem of Underage Drinking

Steven A. Adelman

Every venue that serves alcohol, whether a fairground, amusement park, carnival, or arena, struggles to serve their patrons while not overserving to the point of intoxication. Lawyers routinely hear event managers complain that short of someone throwing up or falling down, they cannot identify a drunk during the brief exchange necessary to buy the next round of beers. Nonetheless, under “dram shop” law, most states hold alcohol servers liable for getting a patron drunk if they injure someone because of their impairment.

Where patrons under the drinking age are involved, venues must be even more vigilant. In fact, the trend is closer to a zero-tolerance rule than ever.

For venue liability arising from alcohol sales, there is good news and bad news. The good news is that a huge dram shop verdict was recently overturned on appeal. In Verni v. Harry M. Stevens, Inc., a New Jersey jury awarded $110 million against Aramark for repeatedly serving a man who then caused an accident that left a little girl paralyzed. The New Jersey appeals court reversed the verdict and set the case to be retried. As a matter of evidence law, Aramark was prejudiced by testimony about a “culture of intoxication” at Giants Stadium which was not directly related to the Verni accident. So the next jury can hear that Daniel Lanzaro drank so much at a Saints-Giants football game that he still had a whopping 0.266 blood alcohol concentration several hours later, but they will not learn that Harry M. Stevens had a “standard practice” of serving people who were visibly drunk and cut people off only when they were “excessively intoxicated.”

If the good news is that one beer vendor was saved from an adverse verdict in one case involving an intoxicated adult, the bad news is that when an underage person gets served, the law is less forgiving than ever. It is important to point out that this is not a concern only for beer vendors. Because nearly every party involved in live entertainment is a well-insured “deep pocket,” everyone gets sued. In Verni, for example, defendants in that long and costly lawsuit included not only four Aramark companies, but also Giants Stadium and the municipal authority that operates it, as well as the National Football League.

The most recent case involving liability for serving an underage drinker comes from Massachusetts. In Nunez v. Carrabba’s Italian Grill, Inc., the Commonwealth’s highest court held that instead of having to prove that a server negligently served someone who was visibly intoxicated, the victim only has to prove that the server knew or should have known the patron was under 21 years old. Put another way, unlike a venue’s duty not to serve obviously intoxicated adults, the duty to refrain from serving underage drinkers does not depend on whether they seem drunk or not.

The facts in Nunez underscore that when it comes to people under twenty-one, virtually no amount of fault by the drinker will protect the server from liability. Robert Nunez was an 18-year-old who used to work at Carrabba’s as a waiter. From 7:00 to 9:30 PM, he was served dinner and half a dozen drinks, for which the staff took care of the bill. He went home for two hours, then at 11:30 PM, he drove to a nightclub. Because he used to work there too, he did not even show his fake identification, and the bartender gave him a couple more free drinks. Roughly three hours after he left the restaurant, between midnight and 1:00 AM, Robert Nunez headed home. He was not wearing a seatbelt; he was speeding through an intersection; he was hit by a car that ran a red light; his blood alcohol content at the time of the accident was 0.13. The restaurant filed a motion to get out of the case. The motion was denied.

The Massachusetts court drew a sharp distinction between adults versus underage drinkers. The requirement that a plaintiff prove reckless conduct in serving an adult “reflects the Legislature’s unwillingness to allow a person who has voluntarily and responsibly put himself into a condition where his judgment and functioning are impaired to cast the blame on others, when he suffers injury as a result of that condition.” However, the Court was willing to apply that logic only to adults, adding “[t]hat is a moral and a policy judgment that does not extend to furnishing alcohol to minors.”

Nunez does not reconcile the conflicting public policy issues regarding underage adult drinking. On one hand, people under twenty-one “are thought to be peculiarly susceptible to the effects of alcohol and less able to make decisions about what amount of alcohol they may safely consume in various situations.” On the other hand, the Court also listed the rights and obligations of underage adults, including voting, signing a contract, getting married without parental consent, serving on a jury, and buying a gun. As a matter of law, young people’s decision-making on these subjects is evidently more trustworthy.

Massachusetts’ tougher line against serving underage drinkers is typical. Since 2000, seven other states have upheld liability against venues whose servers knew or should have known they were serving underage drinkers. But not every state takes such a strong stand. In Iowa, a plaintiff must prove the server actually knew he was serving someone less than twenty-one, and in Louisiana, a venue may have no liability for serving underage drinkers at all.

As a general proposition, however, a casual attitude towards underage drinking is a liability time bomb. The Surgeon General estimates that there are 11 million underage drinkers in this country. The likelihood that underage people are drinking while enjoying live entertainment at your facility is so high that rather than asking whether you are serving underage drinkers, ask how many. As a result, the liability question is not whether you will be served with a lawsuit involving someone under twenty-one, but when.

So what should a venue do? As much as you can. Unless you enjoy taking risks with people’s lives (and facing catastrophic jury verdicts), you should enroll in an alcohol service training program. For example, TEAM Coalition works with major professional sports and entertainment venues to refine their alcohol policies and help train event-day staff. One particularly important aspect of TEAM’s training is coordinating alcohol vendors with ushers and event staff to prevent legal drinkers from buying drinks, then passing them to underage friends after leaving the concession area. An alcohol awareness program targeted to concessionaires, TIPS, also teaches techniques to prevent underage drinking.

In addition to training your servers, technology can help. For states whose driver’s licenses have bar codes, scanners can detect fake IDs. Even a simple colored light can show where a laminate has been cut or a hologram has been altered. The days when it was enough to confirm that a patron looks like their picture before giving them a wristband are long gone.

Even the best lawyer cannot keep a public assembly facility from getting sued. Accidents and litigation are facts of life when you invite thousands of people to your event and encourage them to lower their inhibitions and have a good time. But in the current legal environment, alcohol and young people simply do not mix.

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