US Supreme Court Strikes Down Ban on Some Interstate Wine Shipments
Today the US Supreme Court struck down the ban on interstate wine shipment for states that allow shipments from wineries in the state. This means state cannot bar out of state wineries from shipping to residence, if they allow wineries in the same state to ship to residence. States will still be free to ban all shipments of wine to residences.
Professor Stephen Bainbridge, a UCLA professor of corporate law and the author of Professor Bainbridge on Wine has some comments on the ruling.
As I understand this, the 21st amendment that ended prohibition granted the states broad authority to regulate the sale of alcoholic beverages. The states of Michigan and New York, which were parties to this case, claimed that gave them the authority to allow wineries in the state to ship wine to state residents, but to forbid out of state wineries to ship to their state residents. The wineries pointed to the Commerce Clause in the US Constitution that forbids states from discriminating against out of state producers, and grants Congress the authority to regulate interstate commerce.
The question came down to whether the 21st amendment language was meant to supercede the Commerce Clause or whether the Commerce Clause still applied. In this case the Supreme Court ruled 5-4 that the Commerce Clause applied, and that states are not free to discriminate against out of state wineries.
What does this all mean? It is not clear yet. Here in California, this probably has no impact. Professor Bainbridge thinks that many of the 24 states that have laws like this will decide to outlaw all wine shipments rather than allow interstate shipments. The reason for this is that those states have a small number of wineries and they are not a big part of the economy, so they do not have much political influence. The wine wholesalers and retailers will pressure the legislature to ban interstate wine shipments, because they do not want the competition. They will also use neo-prohibitionist arguments, like this would encourage sales to minors, even though there is no evidence that it does.
If people in states that are affected by this ruling want to be able to receive wine shipments, they will need to start writing their state legislature to make sure they know this is an issue.
Professor Stephen Bainbridge, a UCLA professor of corporate law and the author of Professor Bainbridge on Wine has some comments on the ruling.
As I understand this, the 21st amendment that ended prohibition granted the states broad authority to regulate the sale of alcoholic beverages. The states of Michigan and New York, which were parties to this case, claimed that gave them the authority to allow wineries in the state to ship wine to state residents, but to forbid out of state wineries to ship to their state residents. The wineries pointed to the Commerce Clause in the US Constitution that forbids states from discriminating against out of state producers, and grants Congress the authority to regulate interstate commerce.
The question came down to whether the 21st amendment language was meant to supercede the Commerce Clause or whether the Commerce Clause still applied. In this case the Supreme Court ruled 5-4 that the Commerce Clause applied, and that states are not free to discriminate against out of state wineries.
What does this all mean? It is not clear yet. Here in California, this probably has no impact. Professor Bainbridge thinks that many of the 24 states that have laws like this will decide to outlaw all wine shipments rather than allow interstate shipments. The reason for this is that those states have a small number of wineries and they are not a big part of the economy, so they do not have much political influence. The wine wholesalers and retailers will pressure the legislature to ban interstate wine shipments, because they do not want the competition. They will also use neo-prohibitionist arguments, like this would encourage sales to minors, even though there is no evidence that it does.
If people in states that are affected by this ruling want to be able to receive wine shipments, they will need to start writing their state legislature to make sure they know this is an issue.
posted by mikeca | 10:06 PM
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