Senate Study Bill 3195 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON WAYS AND MEANS BILL BY CHAIRPERSON DAWSON) A BILL FOR An Act relating to civil liability and associated insurance 1 requirements of alcoholic beverage licensees or permittees 2 who also sell or serve consumable hemp products. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 6364XC (3) 90 nls/ns

S.F. _____ Section 1. Section 123.3, Code 2024, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 15A. “Consumable hemp product” means the 3 same as defined in section 204.2. 4 Sec. 2. Section 123.92, subsection 1, Code 2024, is amended 5 to read as follows: 6 1. a. Subject to the limitation amount specified in 7 paragraph “c” or “d” , if applicable, any third party who is 8 not the intoxicated person who caused the injury at issue and 9 who is injured in person or property or means of support by 10 an intoxicated person or resulting from the intoxication of a 11 person, has a right of action for damages actually sustained, 12 severally or jointly against any licensee or permittee, whether 13 or not the license or permit was issued by the department or 14 by the licensing authority of any other state, who sold and 15 served any alcoholic beverage of the following directly to 16 the intoxicated person, provided that the person was visibly 17 intoxicated at the time of the sale or service . : 18 (1) Any alcoholic beverage. 19 (2) Any consumable hemp product, if the licensee or 20 permittee is also registered to sell consumable hemp products 21 under section 204.7 or by another jurisdiction. 22 b. If the injury was proximately caused by an intoxicated 23 person, a permittee or licensee may establish as an affirmative 24 defense that the intoxication did not contribute to the 25 injurious action of the person. 26 c. The total amount recoverable by each plaintiff in any 27 civil action for noneconomic damages for personal injury, 28 whether in tort, contract, or otherwise, against a licensee or 29 permittee who sold and served any alcoholic beverage giving 30 rise to such civil action but who did not sell or serve any 31 consumable hemp product giving rise to such civil action , shall 32 be limited to two hundred fifty thousand dollars for any injury 33 to or death of a person, unless the jury determines that there 34 is a substantial or permanent loss or impairment of a bodily 35 -1- LSB 6364XC (3) 90 nls/ns 1/ 3

S.F. _____ function, substantial disfigurement, or death, which warrants a 1 finding that imposition of such a limitation would deprive the 2 plaintiff of just compensation for the injuries sustained. 3 d. The total amount recoverable by each plaintiff in any 4 civil action for noneconomic damages for personal injury, 5 whether in tort, contract, or otherwise, against a licensee 6 or permittee who sold and served any consumable hemp product 7 giving rise to such civil action, regardless of whether the 8 licensee or permittee also sold and served any alcoholic 9 beverage giving rise to such civil action, shall be limited 10 to five hundred thousand dollars for any injury to or death 11 of a person, unless the jury determines that there is a 12 substantial or permanent loss or impairment of a bodily 13 function, substantial disfigurement, or death, which warrants a 14 finding that imposition of such a limitation would deprive the 15 plaintiff of just compensation for the injuries sustained. 16 Sec. 3. Section 123.92, subsection 2, paragraph c, Code 17 2024, is amended to read as follows: 18 c. The purpose of dramshop liability insurance is to provide 19 protection for members of the public who experience damages as 20 a result of licensees serving patrons any alcoholic beverage 21 or consumable hemp product to a point that reaches or exceeds 22 the standard set forth in law for liability. Minimum coverage 23 requirements for such insurance are not for the purpose of 24 making the insurance affordable for all licensees regardless 25 of claims experience. A dramshop liability insurance policy 26 obtained by a licensee shall meet the minimum insurance 27 coverage requirements as determined by the department and is a 28 mandatory condition for holding a license. 29 EXPLANATION 30 The inclusion of this explanation does not constitute agreement with 31 the explanation’s substance by the members of the general assembly. 32 This bill relates to civil liability and associated 33 insurance requirements of alcoholic beverage licensees or 34 permittees who also sell or serve consumable hemp products. 35 -2- LSB 6364XC (3) 90 nls/ns 2/ 3

S.F. _____ Current law provides for civil liability and insurance 1 requirements for alcoholic beverage licensees and permittees 2 who sell and serve alcoholic beverages to a visibly intoxicated 3 person (dramshop Act). The bill expands the applicability 4 of the dramshop Act to include a licensee or permittee who 5 sells or serves any consumable hemp product (CHP), if the 6 licensee or permittee is also registered to sell CHPs in Iowa 7 (Code section 204.7) or by another jurisdiction. The total 8 amount recoverable by each plaintiff in any civil action for 9 noneconomic damages for personal injury against a licensee 10 or permittee who sold and served any CHP giving rise to 11 such civil action is limited to $500,000 for any injury or 12 death of a person, unless the jury determines that there is 13 a substantial or permanent loss or impairment of a bodily 14 function, substantial disfigurement, or death, which warrants 15 a finding that imposition of such a limitation would deprive 16 the plaintiff of just compensation for the injuries sustained. 17 Under current law, the limitation applicable to selling 18 and serving alcoholic beverages is $250,000, with a similar 19 exception. 20 Current law prohibits a person from selling, dispensing, 21 or giving to an intoxicated person, or one simulating 22 intoxication, any alcoholic beverage (Code section 123.49(1)). 23 A person who violates this provision is guilty of a simple 24 misdemeanor and the violation is also grounds for the 25 suspension or revocation of an alcohol license (Code section 26 123.50). The bill does not apply these provisions to CHPs. 27 -3- LSB 6364XC (3) 90 nls/ns 3/ 3