The lawsuit targets Ruan Transport, the Iowa-based contractor that runs the state’s sole liquor and wine distribution warehouse for the Mississippi Department of Revenue. The complaint says Ruan mishandled the transition to a new warehouse management system, leading to delays, partial shipments and other breakdowns for retailers that had no legal backup source.
Michael Casano, co-owner of Aloha Wine and Spirits in Diamondhead, said the timing made the disruption especially damaging on the Coast, where Mardi Gras and spring break are major sales periods.
“You have slow seasons and you have busy seasons. Well, this has hit the Mississippi Gulf Coast in a busy season and it's just crushing us,” Casano said.
The complaint alleges Ruan rolled out software that was not compatible with the ABC warehouse’s conveyor system, took conveyor lines out of service and fell back on a slower manual process that sharply reduced throughput. According to the suit, the backlog had eclipsed 220,000 unshipped cases by March 1.
The stores are seeking damages tied to lost sales and other business harms. The lawsuit also makes a broader legal argument, saying licensed alcohol retailers can sue over a breach of the contract between the state and Ruan because the warehouse system exists to serve them.
Casano said the disruption has been especially risky for stores like his near the Louisiana state line. He says competitors are already cutting prices to take advantage of the vacuum in the market.
“Our hope is certainly that we've established loyalty with customers in the last 20 years. It's just we don't have the answer yet as to whether or not they're going to establish relationships with stores in Louisiana and not come back,” Casano said.
During a House committee hearing on ABC problems in February, retailers told lawmakers they were dealing with empty shelves, partial shipments, billing problems and delayed refunds. Hospitality leaders said the shortages were also affecting restaurants and casinos.
Lawmakers later tried to create a temporary workaround. The House amended a Senate alcohol bill with language that would have allowed licensed retailers directly from outside distributors for the next two years, but the Senate rejected that proposal on Tuesday..
In a statement, the Department of Revenue said the initial technical issues at the warehouse have been resolved and that shipments in recent weeks have been significantly higher than they were during the same period last year.
