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Pizza Hut wins appeal on license Court says chain is not a store, can sell liquor


After nearly four years, Pizza Hut customers in Hampstead will finally be able to get a mug of beer with their pizza.

The state Court of Special Appeals ruled Friday that franchised restaurants, such as Pizza Hut, are not chain stores and can apply for a Class B beer, wine and liquor license. The decision affirms an opinion by Carroll County Circuit Judge Luke K. Burns Jr. last year.

"I'm pleased that we won," said William B. Dulany, attorney for Pizza Hut of Maryland. "For the first time in Maryland, we have a decision in an appellate court in a reported opinion that a restaurant is not a store, and it defines the difference."

The Carroll County Board of License Commissioners had denied a license to the Hampstead establishment in 1989, even though three county Pizza Hut restaurants had liquor licenses.

The board also filed suit in Carroll County Circuit Court, seeking to revoke the previously issued Pizza Hut liquor licenses. The board argued that the licenses shouldn't have been issued because Pizza Hut is considered a chain store in Maryland for tax purposes.

Judge Burns said in his ruling last year that restaurants are different from chain stores because "the former performs a service in transforming ingredients into an edible product very different from the ingredients themselves."

The Court of Appeals agreed, saying that an establishment's tax status has no bearing on its ability to obtain a liquor license.

"The county was saying that Pizza Hut was a chain store," Judge Burns said yesterday. "What do you think of when you say chain store? I think of things like Wal-Mart. They thought Pizza Hut was a chain store. I disagreed."

Carroll County Attorney Charles W. Thompson Jr. was not available for comment yesterday.

The decision applies to all 23 Maryland counties and Baltimore City because the Carroll County liquor board was seeking an opinion on a segment of the statewide liquor law, Mr. Dulany said.

"I have received a lot of calls from out of state, from corporations who could be interested in locating restaurants in Maryland that could be considered chains," he said.

"This should be a good decision for the state of Maryland because it should bring in some nice new restaurants."

Both Chi-Chi's and Red Lobster restaurants had postponed decisions to locate in Carroll County until this case was decided.

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