(a) Notwithstanding any other provision of this chapter, a beer manufacturer, holder of a winegrower’s license, rectifier, winegrower’s agent, holder of an importer’s general license, distilled spirits manufacturer, craft distiller, holder of a distilled spirits rectifier’s general license, or distilled spirits manufacturer’s agent, regardless of any other licenses held by the foregoing, may sponsor events promoted by, and may purchase advertising space and time from, or on behalf of, an on-sale licensee that is the owner, operator, agent of the operator, or assignee of the operator’s advertising rights of a mixed-use district subject to all of the following conditions:

(1) The owner, operator, agent of the operator, or sole assignee of the operator’s advertising rights of the mixed-use district has its principal place of business in the County of Orange.

(2) The mixed-use district consists of not less than 90 acres that include office, residential, hotel, retail, dining, public gathering, and performing arts facilities, as well as a public intermodal transportation center, all of which are situated on land surrounding a fully enclosed arena with a fixed seating capacity in excess of 18,000 seats located in the County of Orange.

(3) The advertising space or time is purchased only in connection with retail, dining, entertainment, and events conducted on the grounds of the mixed-use district. Nothing in this section shall authorize advertising or promoting of any retail licensee or premises other than an on-sale licensee or premises owned by the person described in paragraph (1). Nothing in this section shall authorize the placement of advertising space or time outside of the mixed-use district.

(4) Any on-sale licensee, including any on-sale licensee owned by the person described in paragraph (1), operating at a venue on the grounds of the mixed-use district shall serve other brands of beer, distilled spirits, and wine in addition to any brand manufactured or distributed by the sponsoring or advertising beer manufacturer, holder of a winegrower’s license, rectifier, winegrower’s agent, holder of an importer’s general license, distilled spirits manufacturer, craft distiller, holder of a distilled spirits rectifier’s general license, or distilled spirits manufacturer’s agent.

(5) An agreement for the sponsorship of, or for the purchase of advertising space and time in connection with, the retail, dining, entertainment, and events conducted on the grounds of the mixed-use district shall not be conditioned directly or indirectly, in any way, on the purchase, sale, or distribution of any alcoholic beverage manufactured or distributed by the sponsoring or advertising beer manufacturer, holder of a winegrower’s license, rectifier, winegrower’s agent, holder of an importer’s general license, distilled spirits manufacturer, craft distiller, holder of a distilled spirits rectifier’s general license, or distilled spirits manufacturer’s agent, or by any on-sale retail licensee.

(6) Advertising authorized by this section may be placed in areas within the mixed-use district, provided that the advertising shall not be placed on or in or otherwise promote any permanently licensed retail premises, except as authorized in subdivision (g).

(7) Except as authorized in subdivision (g), a person, including the person described in paragraph (1) or any on-sale licensee owned by the person described in paragraph (1), shall not establish conditions, directly or indirectly, on any retail licensee or retail licensed business in the mixed-use district, or as a condition for any retail licensee or retail licensed business to lease, rent, or purchase property in the mixed-use district, that require or authorize the retail licensee or retail licensed business to display advertisements authorized by this section.

(b) Any sponsorship of events or purchase of advertising space or time conducted pursuant to subdivision (a) shall be conducted pursuant to a written contract entered into by the beer manufacturer, holder of a winegrower’s license, rectifier, winegrower’s agent, holder of an importer’s general license, distilled spirits manufacturer, craft distiller, holder of a distilled spirits rectifier’s general license, or distilled spirits manufacturer’s agent and any of the following:

(1) The person described in paragraph (1) of subdivision (a).

(2) Any on-sale licensee owned by the person described in paragraph (1) of subdivision (a).

(c) Any beer manufacturer, holder of a winegrower’s license, rectifier, winegrower’s agent, holder of an importer’s general license, distilled spirits manufacturer, craft distiller, holder of a distilled spirits rectifier’s general license, or distilled spirits manufacturer’s agent who, through coercion or other illegal means, induces, directly or indirectly, a holder of a wholesaler’s license to fulfill those contractual obligations entered into pursuant to this section shall be guilty of a misdemeanor and shall be punished by imprisonment in the county jail not exceeding six months, or by a fine in an amount equal to the entire value of the advertising space or time involved in the contract, whichever is greater, plus ten thousand dollars ($10,000), or by both imprisonment and fine. The person shall also be subject to license revocation pursuant to Section 24200.

(d) Any on-sale retail licensee who, directly or indirectly, solicits or coerces a holder of a wholesaler’s license to solicit a beer manufacturer, holder of a winegrower’s license, rectifier, winegrower’s agent, holder of an importer’s general license, distilled spirits manufacturer, craft distiller, holder of a distilled spirits rectifier’s general license, or distilled spirits manufacturer’s agent to purchase advertising time or space pursuant to this section shall be guilty of a misdemeanor and shall be punished by imprisonment in the county jail not exceeding six months, or by a fine in an amount equal to the entire value of the advertising space or time involved in the contract, whichever is greater, plus ten thousand dollars ($10,000), or by both imprisonment and fine. The person shall also be subject to license revocation pursuant to Section 24200.

(e) For purposes of this section, “beer manufacturer” includes a holder of a beer manufacturer’s license, holder of an out-of-state beer manufacturer’s certificate, or holder of a beer and wine importer’s general license.

(f) Nothing in this section shall authorize the purchasing of advertising space or time directly from, or on behalf of, any on-sale licensee other than the person described in paragraph (1) of subdivision (a) or an on-sale licensee owned by that person.

(g) Nothing in this section shall authorize the placement of advertising space or time directly in, or on the exterior of, the premises of any on-sale licensee in the mixed-use district except as follows:

(1) An on-sale licensee that is wholly owned by the person described in paragraph (1) of subdivision (a).

(2) (A) Subject to the limitations described in subparagraphs (B) to (E), inclusive, the lobby areas of hotels, performing arts venues, and entertainment venues, that are not owned by the person described in paragraph (1) of subdivision (a).

(B) Placement of advertising space or time is not authorized in parts of a lobby area that contain a bar or restaurant.

(C) Placement of advertising space or time that is customized to the particular lobby area is not authorized.

(D) Placement of advertising space or time in more than one location in a lobby area is not authorized.

(E) Placement of advertising space or time on a sign or other display that is not owned by the person described in paragraph (1) of subdivision (a) is not authorized.

(3) The common area-facing exteriors of hotels, performing art venues, entertainment venues, and buildings with multiple tenants including an on-sale licensed premises that is not owned by the person described in paragraph (1) of subdivision (a).

(4) The authorization provided by this subdivision is subject to the limitations provided in subdivisions (h) and (i).

(h) Nothing in this section shall authorize a beer manufacturer, holder of a winegrower’s license, rectifier, winegrower’s agent, holder of an importer’s general license, distilled spirits manufacturer, craft distiller, holder of a distilled spirits rectifier’s general license, or distilled spirits manufacturer’s agent to furnish, give, or lend anything of value to an on-sale retail licensee, either directly or indirectly, other than the person described in paragraph (1) of subdivision (a) or an on-sale licensee owned by that person and except as expressly authorized by this section or this division.

(i) No funds, revenue, or other consideration from any sponsorship of events or purchase of advertising space or time conducted pursuant to this section shall be furnished, given, or lent, either directly or indirectly, by the person described in paragraph (1) of subdivision (a), or by an on-sale licensee owned by that person, to any licensee other than an on-sale licensee owned by the person described in paragraph (1) of subdivision (a).

(j) Nothing in this section shall be construed to limit or abrogate the provisions of Chapter 2 (commencing with Section 5200) of Division 3.

(k) The Legislature finds that it is necessary and proper to require a separation among manufacturing interests, wholesale interests, and retail interests in the production and distribution of alcoholic beverages in order to prevent suppliers from dominating local markets through vertical integration and to prevent excessive sales of alcoholic beverages produced by overly aggressive marketing techniques. The Legislature further finds that the exceptions established by this section to the general prohibition against tied interests shall be limited to their express terms so as not to undermine the general prohibition and intends that this section be construed accordingly.

(Added by Stats. 2021, Ch. 309, Sec. 2. (SB 386) Effective January 1, 2022.)