BETHLEHEM, Pa. — You probably won't know it, but the person in line next to you at your local Fine Wine & Good Spirits store might have no intention of drinking the bottle they’re paying for.
But they may already have plans to resell it, the Associated Press reported last week, catering to a booming market of bourbon drinkers with a thirst for rare brands.
The only problem?
Those resales are breaking the law, and the state’s liquor regulating agency says black market sales of scarce bourbons is a big problem and a booming business.
- The bourbon boom is fueling bad behavior and illegal activity, officials say
- Pappy Van Winkle 23-year-old is among the most coveted bourbons and resells on the secondary market for tens of thousands of dollars
- A spokesman for the PLCB said would-be buyers at state stores have climbed aboard delivery trucks and entered a stockroom to try and get their hands on a bottle
“It’s become increasingly popular over the last several years,” Pennsylvania Liquor Control Board spokesman Shawn Kelly said.
Kelly described limited-edition, single-barrel bourbons as those inordinately desired by collectors and whiskey aficionados who are paying hundreds or even thousands of dollars above retail price on the secondary market.
“In many cases, a lot of these products used to sit on our shelves and collect dust,” Kelly said. “Now we have people waiting for the delivery trucks in our parking lots."
He said there was one instance in which "someone climbed aboard a delivery truck, which is illegal. We had one person enter our stockroom at one of our stores, which is also illegal.”
The scarce bourbons that have people breaking the law to get their hands on them include different expressions (or variations) of Pappy Van Winkle and other top-end labels.
In particular, it’s Pappy Van Winkle 23-year-old — which retails for $299.99 but can sell for tens of thousands of dollars on resale markets.
The Associated Press report said those premium spirits now are at the center of criminal investigations in several states, including Pennsylvania.
‘We just haven’t seen interest decline’
It's the duty of the Pennsylvania State Police Bureau of Liquor Control Enforcement to ensure compliance with the state liquor code, including investigations of unlicensed establishments and individuals selling alcohol.
A person who sells or offers to sell bourbon or any other liquor or malt or brewed beverage without being licensed can face steep fines and other penalties under state law, though the unlawful sale of liquor is a misdemeanor offense.
The fines are $2 per fluid ounce for each container found on the premises where the sale was made or attempted, and the amount is based upon the capacity of each container, whether or not the container was full at the time of the attempted sale.
But it’s not stopping buyers, many of whom would happily pay the suggested retail price of $299.99 — if they could find bottles legally — only to offload it on the secondary market for thousands of dollars.
Many hunting Pappy Van Winkle are part of private online groups — some with thousands of members — and will buy, sell and trade through those means.
Many Facebook groups remain active, even though some were shut down in June 2019, just before 46 state attorneys general signed a letter urging digital platforms to crack down on the unlicensed sales of alcohol.
The fracturing of online groups hasn’t curtailed demand, and Kelly said officials are keenly aware that illegal alcohol sales remain robust and Facebook groups remain active, with posts using code words and wordplay in place of a listing that might otherwise say “bourbon for sale.”
Part of what’s driving the craze, Kelly said, is that it’s up to the distributor as to where Pappy Van Winkle and any other bourbon gets sold. So it’s not always known where the product will hit shelves, or how many bottles will be available.
“With these products, there are 13 million Pennsylvanians and nearly 600 retail stores,” Kelly said. “Where do you put it to make it fair?”
To game the system, so to speak, bourbon hunters try to gain confidential information about upcoming sales or make connections with liquor store managers to determine when bottles will be routed to their store for purchase.
Some buyers will camp in parking lots, sleep in cars, queue up lines at the door and wait days, if need be, for a chance to grab the most high-end products, officials said.
“We take as much as we can get, but the vendor has to meet worldwide demand,” Kelly said. “Pennsylvania has a certain allocation and that’s all we can get. But our store managers can barely get the bottle on the shelf before it’s in someone’s hands.
“A few years ago we saw the same thing with Crown Royal Peach. You just don’t know what’s going to catch on with the public, and so we wonder what the next big bourbon is going to be. We just haven’t seen interest decline.”
‘It’s their Christmas morning’
Pappy Van Winkle is one of the scarcest bourbons on the market because it’s aged for 10 to 23 years.
“We cannot simply start making more today and selling it tomorrow,” the Pappy & Co. website states. “We are producing more bourbon annually, but at a rate that fits within our family’s values of quality over quantity.
"We always want to provide exceptional customer service and reply back to all of our customer inquiries, but we truly cannot assist you with any bourbon-related emails.”
The brand’s popularity skyrocketed in 1996, when it was rated 99 out of 100 by the Beverage Testing Institute — its highest-ever rating for a whiskey.
But Kelly said pop culture also likely played a role. For instance, Mark Harmon’s portrayal of Leroy Jethro Gibbs on the long-running television series “NCIS” often saw the character sipping a glass of bourbon.
“It depends on what picks up buzz on the internet or wins an award," Kelly said. "You just don’t know what’s going to catch on with the public."
“It depends on what picks up buzz on the internet or wins an award. You just don’t know what’s going to catch on with the public."Shawn Kelly, Pennsylvania Liquor Control Board spokesman
To try to tame the fervor, the PLCB turned to a lottery system in late 2015 to give participants the chance to buy rare whiskeys.
“It’s been very popular, with tens of thousands of entries every time,” Kelly said.
Lotteries afford the right to buy individual bottles, with winning entries limited to one bottle per participant, between individual consumers and licensees. If someone is selected and the payment is declined or they can’t make payment, the entrant forfeits his or her entry and the right to buy the bottle.
In light of attempts by previous winners to illegally resell their bottles, entrants also have to acknowledge the terms and conditions outlining that selling without a license is prohibited under Pennsylvania law.
“It is an opportunity to win the ‘holy grail’ bottle,” Kelly said, but "sometimes they win and then they realize they probably shouldn’t have entered because they can’t afford it.”
There’s truly no telling, he said, when the demand for these highly coveted products will ease.
“For those who get a chance to buy a bottle, it’s their Christmas morning.”
