The Legal Implications Surrounding "Palcohol"

On March 10, 2015, the Alcohol and Tobacco Tax and Trade Bureau ("TTB") approved a controversial product called Palcohol for sale in the United States.  Palcohol is a powdered alcohol that is meant to be mixed with water or other liquids and will have the same alcohol content when mixed with the appropriate amount of liquid. Think instant coffee, only replace the coffee with vodka, rum, or a tequila/margarita mix.

There is immediate uproar surrounding the approval.  Sen. Charles Schumer has already introduced legislation to ban powdered alcohol on a federal level. Based upon the wording in the 21st Amendment to the Constitution, the states also have the power to regulate alcoholic beverages. Many delegate that right to local government.  Several states have already taken action to prevent the distribution - Alaska having outright banned it, and Louisiana, Nebraska, Pennsylvania, South Carolina, Vermont and Virginia having taken regulatory action against it. 

Concerns over the safety of the product are abundant.  Many are concerned about the potential for individuals to snort it, to mix it with the wrong quantity of liquid making drinks extremely potent, the ease to conceal the product, the potential for underage use, and the potential to mix with other illicit drugs.

Besides safety, the regulation of this new technology will be incredibly difficult to coexist with existing laws and regulations for alcohol.  While many state and local governments ban open containers, it will put a whole new responsibility on those enforcing open container laws. Drinking and driving laws may also be implicated, as it would be even more difficult to identify illegal activity with a dry and scentless powder.  Many states have regulations for bars and restaurants to enforce underage drinking, but imagine how difficult that would be when an individual merely orders a water or coke, and mixes their own cocktail. Would insurance companies have to account for this and raise premiums for Dram Shop insurance?  Likely so. It will also certainly be easier to sneak into establishments, public events, concerts, or other places where bringing your own alcohol is currently not permitted.

In the next few months, it will be interesting to watch how state and local governments react to the federal approval of powdered alcohol.  If it's not on their radar, it should be as it could really shake up all of the existing laws and regulations they have put in place to prevent the abuse of alcohol.