Debt is worse than initially reported. State is reaching out to impacted employees.
We recently reported that Rogue Brewery had abruptly ceased all operations. The closure included its brewery and production facility in Newport, Oregon and all of its pubs in other cities. Everything suddenly closed without warning. That is to say, without warning to the employees and the public. For Rogue Brewery’s creditors, this was much less of a surprise.
The initial report suggested that the company owed its landlord, the Port of Newport, over $500,000 in rent and owed Lincoln County $30,000 in taxes (that number turned out to be more like $918,000 in delinquent property taxes). The November 25th bankruptcy filing revealed that the previously reported numbers were just the tip of the iceberg.
The bankruptcy filing included 29 pages of claims for unsecured creditors, totalling $14,777,717. Add to that another couple of million in debt, and the total is more than $16 million. The Brewbound report outlines additional details about the bankruptcy filing.
The most significant unsecured claim is a $10 million dram shop negligence claim owed to the estate of a person who died in an auto accident. “Dram shop negligence claim” is a term used to define a lawsuit against an establishment for serving alcohol to someone who was visibly intoxicated or underage, and who then causes an injury or death to another person. In this case, the incident was a fatal traffic accident in 2022, caused by a driver who was allegedly overserved at a Rogue establishment. That driver was charged with first- and second-degree manslaughter and driving under the influence.
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Not to drift too far away from the topic at hand, but businesses that manufacture or sell alcohol usually carry liquor liability insurance. It’s very wise that they do so, though it is not cheap. Unlike general business liability insurance, liquor liability insurance is specifically designed to protect businesses from the particular risks associated with the industry, including liability claims and settlements from incidents like a car accident caused by an intoxicated patron, or a fight between two drunk bozos that results in injuries or property damage.
Nothing in the filing suggests that Rogue did or did not have this kind of liability insurance. The lawsuit was a line item in the filing. That’s all we know.
Whatever the case, this entire story is unfortunate in many ways, not least the impact on Rogue’s employees. According to KCBY, a local television outlet, the state of Oregon activated its rapid response team to support affected workers. Commissioner Casey Miller told KCBY: “This kind of abrupt job loss is deeply stressful for families. Our regional partners are moving quickly to make sure support is clear, accessible, and practical. Please share this information widely.”
Have beer-related news or information you’d like us to share with our audience? We are always happy to help you spread the word. Here’s how to contact the Washington Beer Blog.
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