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Plan to Profit on License and Seek Another Raises Concerns for Liquor Board

Martino's Liquors is selling its package store license to Trader Joe's while simultaneously seeking just a beer and wine license to replace it.

It’s allowed under state law, but Frank Martino may have an uphill battle in front of him now that he’s selling his liquor license for a tidy profit and hoping to get a beer and wine license from the city to replace it.

Martino, who owns on Route 1, has an agreement with to . While asking the Peabody Licensing Board to approve that transfer, he’s simultaneously asking for the lesser package store license. Both points have raised some eyebrows on the board.

Board member Charles Holden told attorneys John Keilty and Andrew Upton, who were representing Martino and Trader Joe’s Monday night, he questioned whether it was an ethical decision to make as a business owner, given the fact that Martino paid the city just $2,250 for the license and chose not to seek a beer and wine license instead (there were two available last year).

“I know it’s a business decision,” Holden said, a business owner himself. “But using a license as a profit vehicle…is it legal? Yes. Is it ethical?”

He added that it’s not often the board sees someone sell a license and ask the same day for another one.

“I have no problem with him selling the license, but I would look long and hard at him getting a new license,” Holden said.

Board Chairman Minas Dakos agreed with Holden, saying Martino’s actions . Dakos noted that the package store license was the .

“Less than a year later, he wants to sell it. Did he give it a fair run?” Dakos said.

Keilty said Martino was not looking to sell, but Trader Joe’s approached him through a broker and offered a deal as a result of a change in state law that allowed the company to seek additional licenses. Keilty said he didn’t believe Martino’s intent a year ago was ever to reap a profit on the license.

“This suddenly became valuable,” he said.

“It is what it is,” Holden responded. He noted that in most cases where a license holder wants to downgrade to beer and wine, the business will just give the full liquor license back to the city rather than selling it.

conducted by police and underage operatives this past spring and only received a warning since it was a first offense – an employee had sold alcohol to a minor after not checking for an ID. Board members gave no indication Monday that incident played into their current concerns.

In any case, the hearing was continued to Oct. 22 because Trader Joe’s first has to receive approval from the City Council to sell alcohol at its Route 114 store.

There are seven zoning districts in Peabody where package store sales are allowed – Trader Joe’s is Regional Business – and all require a special permit from the council. A public hearing has been scheduled for Sept. 27.

If the board approves the transfer and grants Martino the new license, he will have to remove some hard liquor, such as scotch and whiskey, from his store.

The board does have the discretion to reject a license application on the grounds that it is not in the best interest of the community, but whether that would just end up in a legal appeal is another story.

Bob Croce August 28, 2012 at 04:28 PM
Frank Martino did nothing illegal, so nothing should be done to penalize him. Last thing the taxpayers need is another lawsuit, which in this case we'd lose. Some people are missing the point here, which is: should the city find a way to change the rules so this doesn't happen again in the future? Or, is it even possible to change these rules? We talked about this on "You Make The Call" with City Councilor Barry Sinewitz. The discussion will be replayed tomorrow night (Wednesday), 8-9 p.m. on PAT Channel 99. You can also join the discussion on this topic by liking our Facebook Page: https://www.facebook.com/calldickandbob
Jonnie Stevens August 28, 2012 at 05:27 PM
Bob, here is the point. He is a new business man in Peabody coming from Topsfield. This is not the kind of business man I want in our city if he is going to exploit what may be seen as a weakness in our city rules. He should have returned the license knowing he did not want to sell hard liquor and make it available to maybe a local business that could benefit with the license. Instead he sold it off to the highest bidder at 100X the value he paid for it. I personally hope his business fails in that strip mall and I will tell you that I am boycotting the business and I am also boycotting you when you decided to run for Ward 5. I think he should donate all the proceeds to the city schools as a good faith move or see what happens when the town he does business in does not support his business and he has to shut down. This guy makes me sick!!!
Jimmy W August 28, 2012 at 06:19 PM
Jonnie, They city shouldn't be the only ones allowed to make money off of these licenses. If there is a loophole, fix it. Until then everything that Frank Martino did is 100% legal. Why are you mad at Mr. Martino for profiting in a capitalist society? You should really be mad at the people who ignored the loophole....not the person who benefited from it. Get over it.
Bob Croce August 28, 2012 at 06:42 PM
Jonnie. I don't think you understand the meaning of what I was saying in my comment. I agree with you that this is a terrible practice. All i'm saying is that what he did was legal, so we can't -- unless we want to lose a lawsuit at taxpayer expense -- do anything about it now. My point is: we need to look into changing the rules, so this never happens again. Not sure why you are so angry with me https://www.facebook.com/calldickandbob
Jonnie Stevens August 28, 2012 at 07:16 PM
This guy is a crook as far as I am concerned. He only cares about his pockets and not about the opportunity to help other small businesses like himself. Yes there may be a loophole but should you take advantage of it? Absolutely not! What a way to show yourself as a new businessman in Peabody...Lets take advantage of the system instead of doing the right thing and giving an opportunity to another smaller business to apply for the full service liquor license. This crook obviously negotiated a price with Trader Joes and I am sure he asked for a lot more money than he is finally ending up with. Jimmy, I completely disagree with you that the city should not profit from the income this guy is generating. They said that he should have returned it meaning he would not get back a dollar from the city. It is a user license that is non-refundable. I cant stand his attorney either, this guy is always looking for loopholes at the special permit hearings. This guy will find away to show losses so he makes a huge score on this sale. I hope to god the city council votes to not allow this secondary market to exist and in the future they must return the license back to the city first. This is why Boston liquor licenses are so expensive and pretty much do not allow any small business owner from open a restuarant I think someone needs to apply for the remaining beer and wine lic so he cant get one and then all he can do is sell his meat! Get out of our town!
Bob Croce August 28, 2012 at 08:09 PM
Again, I agree too that he shouldn't profit. But do you see where I was coming from with my point?
Melissa Secore August 29, 2012 at 10:45 AM
I agree with Bob's points. It is really dumb to hand someone a permit and not put restrictions around it. It is shame on Peabody. Even a dope knows that these have value. Especially if there are supply and demand imbalances. I'm sure he wasn't shopping it. I have been in this guy's deli. I found him to be a class act not some loser dirtball.
Jonnie Stevens August 29, 2012 at 12:26 PM
Let me ask you a question Melissa...You find him to be a class act. Do you have a personal relationship with this guy beyond being a customer? The best businesses and business man portray themselves a certain way because if you acted like a dirtbag then you wouldnt go to their store. I am unsure how you can not say this is a dirtbag move. His attorney is a dirtbag too. I will guarantee his attorney was shopping this license around. His attorney is going to make a lot of money to have this transaction go through. As far as I am concerned he has set the tone of how he wants Peabody to see him...and that is a dirtbag...If he was a friend of Peabody then he wouldnt have pulled this slime move... Lets put this into perspective. Your best friend breaks up with her boyfriend and you wanted to date him so you ask him out. It is not illegal but do you do it? If you do then you are a dirtbag to your friend. I hope Peabody is on this guy with every issue he has because he deserves ZERO leniency with any violations. He better get a nice long suspension for selling alcohol to a minor. BTW Melissa, you think Manning is the right candidate...Enough said

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