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What’s Going On With Hellbender?

UPDATED with Hellbender GoFundMe: https://www.gofundme.com/f/helping-hellbender

On Saturday, March 19th, 2022, Hellbender Brewing Company announced via Instagram that they would be closed that weekend due to “a critical mass of routine and essential repairs and maintenance in the brewery.” 

As first reported by Barred in DC, this was not the case. In fact, Hellbender’s license to produce alcohol was canceled “by the ABC [Alcoholic Beverage Control] Board on November 18, 2020 because they failed to meet the September 30, 2020 renewal deadline and failed to respond to a cease and desist order on October 28, 2020.” In short, Hellbender had been producing, serving, and selling beer for sixteen months without a license. Yikes. 

Hellbender reached out to the Alcoholic Beverage Regulation Administration (ABRA), seeking a reinstatement of their license to produce alcohol. ABRA and the ABC Board denied the request on March 23rd, 2022 and Hellbender remains closed for the time being. 

You have questions. We have some answers (and some speculation). 

How did this happen? 

We believe the license expiration was an oversight and unintentional (so does Barred in DC). DC Beer has reached out to Hellbender ownership and senior employees for comment, but at the time of publication we have received no response. 

In short, Hellbender forgot about renewing the license. We speculate that two factors are at play here. 

The first is the pandemic. In the pivot to packaging — the rush to canning as keg sales evaporated — Hellbender overlooked the licensing and regulatory aspects of brewing in DC. Greg Parnas explains the process: 

“In DC, brewery manufacturer licenses are issued on a uniform three-year cycle at a cost of $5000 per year. The current cycle began on October 1, 2020, and will run until September 30, 2023. A brewery can obtain a license somewhere in the middle of a license cycle, paying the pro-rata amount for that first year, plus any annual fees during the duration of the license, but a permit to brew and sell would nevertheless expire at the end of the uniform three-year cycle even if it hadn’t yet been a full three years since starting operations.” 

Hellbender most likely did receive notice that their license was up for renewal, along with notification explaining that any late fees on the renewal would be waived. Other jurisdictions offered extensions of licensure during the pandemic. 

The second factor is the departure of Hellbender co-founder Patrick Mullane, which happened just before the pandemic. As we understand it, prior to his departure the division of labor at Hellbender was that co-founder Ben Evans was in the brewhouse brewing beer and Mullane was responsible for the taproom and regulatory compliance like licensing and permitting. 

It appears that Mullane’s departure was not entirely amicable and likely created loose ends and a vacuum in some of his duties. Combined with all the challenges presented by the pandemic and it’s not hard to see how Hellbender could have simply overlooked the deadlines.

What will happen to Hellbender?

The brewery must reapply for a Class B license to produce, distribute, and sell alcohol. This could take a few weeks, or it could take months. In addition, Hellbender could be fined, and/or its ownership charged with a crime, for producing alcohol without a license. 

According to Parnas, as of November 18, 2020 “all of Hellbender’s ongoing business activities, including the manufacture, retail sale, and distribution of their beer, would have been illegal. 

“Assuming that the standard procedures were followed, Hellbender would have received notice from ABRA that their renewal was upcoming. Licensees have a right to defend themselves in revocation hearings, which is what the November 18th, 2020 meeting was, so they also would have received notice of the hearing. 

“Finally, Hellbender would have received notice of the ABRA Board decision to revoke their license. Violations of the manufacture license are classified as a ‘primary tier violation,’ which comes with a $1,000 to $2,000 fine, that then doubles for each subsequent violation within a given time period. However, it is unclear if sale and manufacture of beer without a license would be considered a mere violation of the manufacturer license conditions, or something more serious.”

Didn’t ABRA know that Hellbender was brewing without a license? Why did they wait until March, 2022 to shut them down?

We don’t know. This situation doesn’t exactly make ABRA look good, either. Barred in DC does offer a ray of hope, however, saying, “manufacturer licenses aren’t currently required to go through the same protest process as bars/restaurants, and I’ve seen applications seemingly approved pretty quickly.”

What happens to beer that Hellbender has either already made or is in the process of being brewed? 

If you see cans or pints for sale at your local, buy and drink them now. Anything physically on-site at Hellbender, either in cans, kegs, fermenters, or brite tanks is going to sit for a while. Beer will be lost, dumped, because of this. In addition, should Hellbender receive a license to brew again, it would be at least a week after issuance before any new beer would be ready to serve, because that’s about how long it takes to make some styles. 

This sucks, you’re bumming me out.

Sorry, but we’ve got no good news here. Nobody, at least nobody in their right mind, opens a brewery to get rich, they do it for the love and hopefully it’s enough to make a living on. Profit margins in brewing were already tight before the pandemic shut down taprooms, bars, and restaurants. 

It’s worth asking if Hellbender can recover from this. You’re right to be bummed, this situation sucks. We really hope this isn’t the end of Hellbender, which hit their stride over the last few years in terms of beer, with a dialed in Kolsch-style ale in Bare Bones and two of the better lower alcohol-by-volume hazies, Fringe Class and Next Tropic. 

Beyond that, Ben Evans and L.T. Goodluck are good people who’ve been working really hard for the last few years. Hellbender is by all accounts a good neighbor, and has done more outreach than most with their Support Black Businesses line of beers. We hope to see them soon, and will keep readers and listeners updated. Fingers crossed these updates contain either ways to help Hellbender or good news about reopening. 

UPDATE, 4/6/22: A Facebook post from Hellbender CEO Ben Evans confirms some of what’s written about Mullane.

“I have been working 80 hour weeks since we broke ground over 9 years ago. Aside from tips from my occasional taproom shifts, I haven’t collected payments or salary. I had no illusions running a business would be anything but hard work and long hours, but this is something I knew I wanted to do for the rest of my life, and I was willing to sacrifice to build up this company. Insomnia, back injuries, anxiety, panic attacks, severe depression and chest pains have become a normal part of my life while running a business during this pandemic. Without the positive support of my wife, friends and family, I am sure I wouldn’t be alive right now. I have avoided social media and making any statements recently because I have been focusing on fixing our current situation rather than pay attention to the negative chatter. It still surprises me how many people there are in our society that get a perverse sense of joy from the pain and misfortune of others, but it makes me appreciate all the kind words and support I have received even more.
I had a business partner who was in charge of the business side of Hellbender from 2014-2019. One morning in the year before the pandemic, I came into work to find he had packed his desk and left the company. We were with a distributor that was not paying us, and he and I had not been getting along. He emailed his resignation later that morning and left a short list of passwords several days later. He didn’t even leave the necessary password information for me to run my first payroll on time.
After his abrupt departure, I took over his side of the business while continuing to run sales, social media, brewery production and managing the taproom. In this transition time, I was lucky to have great help and support from our other brewer, sales person and taproom managers. In the opening month of the pandemic lockdown, I sent off our renewal check to ABRA, and I was informed by them in late 2020 that we needed to provide our certificate of clean hands from DC OTR. When I tried to obtain that certificate, I discovered that my former business partner had left unpaid taxes that were preventing us from getting the certificate. After attempting to clear the issue with OTR on my own with little progress, I resorted to working with DC tax and licensing specialist lawyers to handle the issue. Having informed ABRA of our delay in getting our clean hands certificate, the lawyers recommendation to me was to push forward with the OTR dealings and present them with the certificate ASAP. The lawyers took nearly a year to clear this issue up with OTR, and my wife and I had to pay them the majority of our life savings to support their legal fees. We did not hear from ABRA during that time except for an award placard they sent us dated June 24, 2021 for “the enforcement of underage drinking program”. When we finally obtained our clean hands certificate, ABRA said they would bring our license to a vote to reinstate, and it was denied unanimously. We have now sent in our license application while continuing to incur fees for utilities, rent, bank loan and taxes, but we still hope to push through this and reopen our doors. We have support from our local community, our council member, and our local ANC, and I hope that will be enough to get this through as quickly as possible.
My goal for this company has always been making great beer above all else. I was a scientist before all of this, but I have been home brewing and apprenticing at microbreweries since I was in my early 20s. I love beer and the brewing process to its core, but I also love the diverse community that has grown around the taproom as well as the great relationships we have built with bars and restaurants throughout the city. I very much hope to see everyone again soon, but until then I will be working hard to get us there.
Cheers,
Ben Evans
CEO”

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