A more thorough explanation:

A dram shop rule, also known as a dram shop law or dram shop act, is a law that holds a commercial establishment that sells alcoholic beverages, such as bars, taverns, and restaurants, liable for the harmful acts of its intoxicated customers. This liability arises when the establishment serves alcohol to a customer who is already intoxicated, and that customer then causes harm to a third party or themselves as a result of their intoxication.

For example, if a bar continues to serve alcohol to a visibly drunk customer who then gets into a car and causes a drunk driving accident, the bar may be held liable for the harm caused by the intoxicated driver. Similarly, if a restaurant serves alcohol to a customer who becomes intoxicated and then gets into a fight with another patron, the restaurant may be held liable for any injuries sustained by the victim of the fight.

Most jurisdictions limit dram shop liability to harm caused to third parties, but some, such as Pennsylvania, extend this liability to cover harm caused to the intoxicated individual themselves. This means that a patron who becomes intoxicated and injures themselves may have a cause of action against the establishment that served them alcohol.

Dram shop laws are typically based on negligence, meaning that liability arises when the establishment serves alcohol to a patron whom the server knows or reasonably should know is already intoxicated, or to someone who is under the legal drinking age.

It is important to note that dram shop laws vary by jurisdiction, and it is important to consult with a legal professional in your area if you have questions about dram shop liability.