Live Oak, Revolver and Peticolas Brewing have brought a constitutional challenge in Texas state district court in Travis County (Austin). Specifically, they claim that Texas cannot force them to give away their territorial rights—a part of their business—for free to distributors. They bring two claims: a takings claim under Article I, Section 17 of the Texas Constitution,[xii] which protects private property rights; and a substantive due process claim under Article I, Section 19 of the Texas Constitution, which protects economic liberty—the right to earn an honest living free from unreasonable government interference.
This case is about property, which can be more than a house or building. Property also includes valuable intangibles like a brand or the right to sell a product. In this case, the brewers claim that the Texas Constitution’s Takings Clause prohibits the government from unconstitutionally requiring them to give away their property as a condition of keeping their licenses to produce alcohol and stay in business. The government has no legitimate interest in requiring craft brewers to give distributors something that those distributors did not build.
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