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Court Strikes Down Ban on Wine Shipments
AP via Yahoo ^ | May 16, 2005 | HOPE YEN

Posted on 05/16/2005 7:41:23 AM PDT by Sthitch

WASHINGTON - Wine lovers may buy directly from out-of-state vineyards, the Supreme Court ruled Monday, striking down laws banning a practice that has flourished because of the Internet and growing popularity of winery tours.

The 5-4 decision overturns laws in New York and Michigan that make it a crime to buy wine directly from vineyards in another state. In all, 24 states have laws that bar interstate shipments.

The state bans are discriminatory and anti-competitive, the court said.

"States have broad power to regulate liquor," Justice Anthony Kennedy wrote for the majority. "This power, however, does not allow states to ban, or severely limit, the direct shipment of out-of-state wine while simultaneously authorizing direct shipment by in-state producers."

"If a state chooses to allow direct shipments of wine, it must do so on evenhanded terms," he wrote.

Kennedy was joined in his opinion by Justices Antonin Scalia, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer.

At issue was the 21st Amendment, which ended Prohibition in 1933 and granted states authority to regulate alcohol sales. Nearly half the states subsequently passed laws requiring outside wineries to sell their products through licensed wholesalers within the state.

But the Constitution also prohibits states from passing laws that discriminate against out-of-state businesses. That led to a challenge to laws in Michigan and New York, which allow direct shipments for in-state wineries but not out-of-state ones.

In a dissent, Justice Clarence Thomas argued that the ruling needlessly overturns long-established regulations aimed partly at protecting minors. State regulators under the 21st Amendment have clear authority to regulate alcohol as the see fit, he wrote.

"The court does this nation no service by ignoring the textual commands of the Constitution and acts of Congress," Thomas wrote.

He was joined in his opinion by Chief Justice William H. Rehnquist, as well as Justices Sandra Day O'Connor and John Paul Stevens.

While the ruling only involves wine sales, industry groups expect that it will soon apply to beer and other alcoholic beverages currently regulated through state-licensed wholesalers and retailers.

In the ruling, Kennedy wrote that states do not have the authority to regulate liquor simply to protect their economic interests.

The decision puts in doubt laws in 24 states that ban out-of-state shipments, although the opinion suggests the laws will be upheld so long as in-state and out-of-state wineries are treated equally.

As a result, states could choose all wineries to sell to consumers directly, but could also bar all wineries from doing so.

The economic stakes are high in the $21.6 billion wine industry. Owners of small wineries, which have proliferated in recent years, say they can't compete with huge companies unless they can sell directly to customers over the Internet or by allowing visitors to their wineries to ship bottles home.

But states collect millions of dollars in alcohol taxes and say the established system helps stem fraud and underage drinking.

The Washington-based Institute for Justice says the 24 states that ban direct shipments from out-of-state wineries are Alabama, Arizona, Arkansas, Connecticut, Delaware, Florida, Indiana, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Mississippi, Montana, Ohio, Oklahoma, Pennsylvania, New Jersey, New York, South Dakota, Tennessee, Utah and Vermont.

The cases are Granholm v. Heald, 03-1116; Michigan Beer & Wine Wholesalers Association v. Heald, 03-1120; and Swedenburg v. Kelly, 03-1274.


TOPICS: Business/Economy
KEYWORDS: interstatetrade; judiciary; wine
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1 posted on 05/16/2005 7:41:23 AM PDT by Sthitch
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To: Sthitch

Interesting in the way the votes fell.


2 posted on 05/16/2005 7:43:38 AM PDT by jwalsh07
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To: Sthitch

Interesting ideological mixing on this decision. And Thomas and Scalia didn't agree. This was the right decision imo.


3 posted on 05/16/2005 7:44:27 AM PDT by justshutupandtakeit (Public Enemy #1, the RATmedia.)
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To: Sthitch

wine is good


4 posted on 05/16/2005 7:44:44 AM PDT by babble-on
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To: babble-on

wine IS good.


5 posted on 05/16/2005 7:48:12 AM PDT by notigar
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To: Sthitch

I've so been waiting for the courts to finally make this ruling. Not that I'm going to order anything... I'm not a wine drinker, but I've always thought the practice was unconstitutional.


6 posted on 05/16/2005 7:50:10 AM PDT by coconutt2000 (NO MORE PEACE FOR OIL!!! DOWN WITH TYRANTS, TERRORISTS, AND TIMIDCRATS!!!! (3-T's For World Peace))
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To: Sthitch
The 5-4 decision overturns laws in New York

now where did i put the address of that fellow from WVa who made blueberry mead?

Im glad this got overturned - there are so many good wineries in the finger lakes who cantsell you their product, except through the liquor stores - and some of the better stuff never hits the shelves because its sold out when they have winery tours

7 posted on 05/16/2005 7:53:58 AM PDT by Revelation 911
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To: Sthitch

Next on the hit parade is every state extorting the names and addresses of customers from Useless Parcel Service, FedEx, and the merchants themselves so they can send you a bill for the tax. The end result of this is going to be the establishment of automatic reporting of every delivery of anything to your house so the state can charge you use/sales tax. You heard it here first.


8 posted on 05/16/2005 7:54:08 AM PDT by agitator (...And that no man might buy or sell, save he that had the mark)
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To: babble-on
wine is good

we just had sauerbraden last night with plenty of red wine in the mix

wine is good

9 posted on 05/16/2005 7:57:34 AM PDT by Revelation 911
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To: notigar; babble-on

Yes, wine is VERY good.


10 posted on 05/16/2005 7:57:45 AM PDT by Sthitch
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To: Sthitch

Hopefully, I will be able to get some good wine into Utah, most of the state liquor stores stock nothing but plonk.


11 posted on 05/16/2005 7:59:18 AM PDT by hunter112 (Total victory at home and in the Middle East!)
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To: Sthitch

This is a good decision, but in the states that don't want to acquiesce, they'll just apply the more stringent guidelines to the IN-state businesses.


12 posted on 05/16/2005 8:01:08 AM PDT by July 4th (A vacant lot cancelled out my vote for Bush.)
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To: Sthitch

Great! Since my son moved from Michigan it has been dificult getting Fenn Valley Wine (450 mile drive).


13 posted on 05/16/2005 8:01:20 AM PDT by golfisnr1 (Democrats are like roaches, hard to get rid of.>)
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To: notigar; babble-on

Only GOOD WINE is GOOD........


14 posted on 05/16/2005 8:06:17 AM PDT by Red Badger (I woke up this morning and discovered my Memory Foam mattress had Alzheimer's......)
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To: golfisnr1

This ruling has very broad implications. I do agree with it.


15 posted on 05/16/2005 8:10:00 AM PDT by Sacajaweau (God Bless Our Troops!!)
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To: Sthitch

"In a dissent, Justice Clarence Thomas argued that the ruling needlessly overturns long-established regulations aimed partly at protecting minors. State regulators under the 21st Amendment have clear authority to regulate alcohol as the see fit, he wrote."

How can a regulation that bars out of state businesses from selling wine directly protect minors when the in state businesses can still sell directly?

I'm getting less and less impressed with Thmoms' logic in his statements these days.


16 posted on 05/16/2005 8:15:44 AM PDT by untrained skeptic
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I love wine, but I've discovered that Reds are triggering migraines for me. That includes Ports as well. I can still drink Whites, but it's just not the same.


17 posted on 05/16/2005 8:19:21 AM PDT by vollmond (Head back to base for debriefing and cocktails.)
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To: Sthitch

http://www.smokymountainwinery.com/

My wifes favorite. A sweet wine.


18 posted on 05/16/2005 8:21:05 AM PDT by Ron in Acreage (Democrat or Communist? Is there a difference?)
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To: agitator

I would agree with the minority in this case; the feds are taking way too much away from the states, period. I don't see it so much as an issue of free trade or alcohol use as I do in what Thomas stated very plainly....

"The court does this nation no service by ignoring the textual commands of the Constitution and acts of Congress"

We are moved rapidly away from this being a group of national states to being one big socialist collective. If the states are devoid of decision making, what is the use of having them?....


19 posted on 05/16/2005 8:31:43 AM PDT by Amalie (FREEDOM had NEVER been another word for nothing left to lose...)
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To: untrained skeptic
Before the ruling there was quite a bit of debate on a wine board where I post concerning how the court would rule. The discussion was split on whether they would side with the Commerce Clause or the 21st Amendment. Many on that board are lawyers so it was interesting to hear their arguments either way. While all on that board wanted the ruling to go the way it did many saw the arguments supporting the 21st Amendment as valid. I just hate the "what about the children" argument in his decent.
20 posted on 05/16/2005 8:33:45 AM PDT by Sthitch
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