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Three Important Steps to Opening a Brewery in California

July 19, 2018

 

 

At the end of 2017, the number of breweries in California reached a new record high of over 900. The California Craft Brewers Association (CCBA) released data that 92% of the state’s residents live within 10 miles of a brewery. If you are one of the many of California residents who loves to drink beer or loves making your neighbors happy by providing them with beer, you have probably entertained the idea of opening a brewery near your home. Opening a brewery is fun and exciting, but it is also a serious business endeavor that needs to be considered from a legal standpoint. Use this brief starter legal guide to opening a brewery in California to get an idea of what you will need to do, and make sure you consult with an experienced business lawyer to make sure your brewery is fully compliant and successful. Please note that this list is basic, and there are many considerations that go into opening a brewery. 

 

Form an Entity

 

The first thing you will want to do is choose a name for your brewery and form a business entity. When choosing a name, you want to make sure that the name you want is not already taken. You do not want to choose a name for you business, creating your branding around that name, and then discover that the name is already being used by another business. At that point, it will be time consuming and costly to change all your branding and file for a name change. The easiest way to go about searching for existing names is to do a Google search and a search on the U.S. Patent and Trademark Office’s (USPTO) website, but for a more comprehensive search, you should hire a lawyer to help.

 

Once you have a business name, you will want to form a business entity. This way, your personal assets may be protected should anything unfortunate happen with your brewery. Most breweries are set up as a limited liability company (LLC) or Subchapter S Corporation (S-Corp), but you will want to speak with an attorney to discuss the best option for you.

 

File Your Trademarks

 

The next thing you will want to do is file trademarks for your brewery name and your beer names with the USPTO. In the same way that you just ensured you are not taking another business’ name, you also do not want another business taking your name. There is nothing worse than a rival brewery springing up later that decides to have the same name as yours or the same names for their products and confusing your customers at best or completely tarnishing your reputation at worst.

 

Apply for Your TTB License and Applicable State and Local Licenses

 

Applying for your brewer’s notice with the Alcohol and Tobacco Trade and Tax Bureau (TTB) is perhaps the most time consuming step. The entire process can take six to 12 months and involve plenty of applications, background checks, and on-site inspections.

 

In addition to applying for your brewer’s notice with the TTB, you will also want to apply for any applicable state and local licenses. In California, there are separate licenses for making and selling beer, so if you plan to do both, you will need to make sure you have both licenses. Here is a list of the common license types in California. Make sure you also consult with an experienced business lawyer in your area to ensure that you are applying for all applicable licenses.

 

Contact an Experienced Business Lawyer

 

Opening a brick and mortar business in California is not easy, but opening a brewery comes with an additional set of regulations to consider. With all of these complexities, you will want an experienced business lawyer in your corner to ensure that you are complying with all federal, state, and local laws and setting yourself up for success. If you are considering opening a brewery in the Santa Monica or greater Los Angeles area, contact the experienced legal professionals at Verhagen Bennett online or at (310) 917-1064 today for your free consultation.

 

About the Author: 

 

Dallas Verhagen is a business attorney, and he is a partner at Verhagen | Bennett LLP.  To learn more about Dallas, please click here.

 

For questions or comments about this post, please email Dallas directly at: Dallas@VerhagenBennett.com

 

To make suggestions about future posts, please email: Info@VerhagenBennett.com

 

 

© 2018 Dallas Verhagen — This article is for general information only. The information presented should not be construed to be formal legal advice nor the formation of a lawyer/client relationship.

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