12-9-104. Unfair and prohibited acts.

(a) It shall be a violation of this act for a manufacturer or manufacturer's officer, agent or other representative thereof:

(i) To coerce or compel, or attempt to coerce or compel, any malt beverage distributor to order or accept delivery of any malt beverage or any other commodity which the distributor has not voluntarily ordered;

(ii) To refuse to deliver in reasonable quantities and within a reasonable time after receipt of the distributor's order to any distributor having a franchise for the distribution and sale of malt beverages by such manufacturer, malt beverages covered by the franchise or contract. However, the refusal to deliver malt beverages shall not be considered a violation of this section if the refusal is due to failure of the distributor to pay the manufacturer pursuant to the contract, the distributor's insolvency, an act of God, work stoppage or delay due to a strike or labor difficulty, a bona fide shortage of materials, freight embargo or other cause over which the manufacturer, or any agent thereof, shall have no control;

(iii) To coerce or compel, or attempt to coerce or compel, a malt beverage distributor to enter into any agreement, whether written or oral, supplementary to an existing franchise with the manufacturer or officer, agent or other representative thereof, by threatening to cancel any franchise or any contractual agreement existing between the manufacturer and distributor. However, notice in good faith by a manufacturer to a malt beverage distributor of the distributor's violation or breach of any terms or provisions of a franchise or contractual agreement shall not constitute a violation of this act if the notice is in writing, is mailed by registered or certified mail to the distributor at his current business address, and contains the specific facts of the distributor's alleged violation or breach of the franchise or contractual agreement;

(iv) To terminate, cancel, fail to renew or refuse to continue the franchise of any distributor without good cause, as defined in this act. The nonrenewal of a franchise or selling agreement without good cause shall constitute an unfair termination or cancellation, regardless of the specified time period of the franchise or selling agreement;

(v) To discriminate, either directly or indirectly, in price, programs or terms of sale offered to franchisees, where the effect of the discrimination may be to substantially lessen competition among distributors or to give to one (1) holder of a franchise any competitive advantage over other holders of the same or similar franchise;

(vi) To prevent or attempt to prevent, by contract or otherwise, any malt beverage distributor from changing the capital structure of his distributorship or the means by or through which he finances the operation of his distributorship;

(vii) To require a malt beverage distributor to assent to a release, assignment, novation, waiver or estoppel which would relieve any person from liability imposed by this act. However, nothing in this section shall be construed to limit or prohibit good faith dispute settlements entered into by the parties;

(viii) To restrict or inhibit, directly or indirectly, the right of free association among manufacturers or distributors of malt beverage for any lawful purpose;

(ix) To fix or maintain the price at which a distributor may resell malt beverages;

(x) To coerce, or attempt to coerce, any distributor to accept delivery of any malt beverage or other commodity ordered by a distributor if the order was properly canceled by the distributor in accordance with the reasonable procedures of the manufacturer;

(xi) To change a distributor's quota of a brand or brands, if the change is not made in good faith;

(xii) To require a distributor, by any means, to participate in or contribute to any local or national advertising fund controlled directly or indirectly by a manufacturer;

(xiii) To take any retaliatory action against a distributor that files a complaint regarding an alleged violation by the manufacturer of state or federal law or an administrative rule;

(xiv) To require or prohibit without good cause any change in the manager or successor manager of any distributor who has been approved by the manufacturer as of the effective date of this act. Should a distributor change an approved manager or successor manager, a manufacturer shall not require or prohibit the change unless the person fails to meet the reasonable standards for similarly situated distributors of the manufacturer;

(xv) To sell or supply any brand or brand extension of malt beverages in this state to a licensed wholesaler other than the licensed wholesaler designated as the exclusive wholesaler for a specific territory for such brand or brand extension by the supplier in a written agreement, except that nothing in this paragraph shall prohibit a supplier from providing malt beverages to consumers in an area on such supplier's premises designated as a hospitality area, or from participating in consumer sampling or taste testing programs of brands of malt beverages not sold to licensed wholesalers in this state, or from otherwise operating as permitted by law;

(xvi) To require for any reason that a wholesaler purchase one (1) or more brands of malt beverages in order for the wholesaler to purchase another brand or brands of malt beverages.

(b) It shall be a violation of this act for a distributor, partner, shareholder or officer or agent thereof to have the right to sell, transfer or assign the management or control ownership of greater than ten percent (10%) of a distributorship without the written consent of the manufacturer, except that the consent shall not be unreasonably withheld. No manufacturer shall unreasonably withhold or delay its approval of any assignment, sale or transfer of the stock of a distributor or of all or any portion of a distributor's assets, distributor's voting stock, the voting stock of any parent corporation or the beneficial ownership or control of any other entity owning or controlling a distributor, including the distributor's rights and obligations under the terms of an agreement, whenever the person to be substituted meets reasonable qualifications. For purposes of this subsection, "unreasonably withhold or delay" means a period in excess of ninety (90) days after receipt by the manufacturer of all information reasonably required from the wholesaler and purchaser. Upon the death or disability of one (1) of the officers, partners or stockholder of greater than ten percent (10%) ownership of a corporate distributorship operating the business of a distributor, no manufacturer shall deny the surviving officers, partners of the partnership or stockholders of the distributorship, the right to become a successor-in-interest to the agreement between the manufacturer and the distributorship, provided that the survivor has been active in the management of the distributor's business and is otherwise capable of carrying on the business of the distributorship. However, upon the death of a distributor, no manufacturer shall deny approval for any transfer of ownership to a designated member of the family of an owner of a distributorship, provided, that the subsequent transfer of ownership by the designated member shall thereafter be subject to the provisions of this subsection.