Supreme Court, and wine.

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Chris S p i k e s
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Re: Supreme Court, and wine.

#51 Post by Chris S p i k e s » June 26th, 2019, 7:29 am

I'd love to hear some of you smart attorneys interpret and opine on the implications of this decision and where things go from here.

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Re: Supreme Court, and wine.

#52 Post by Neal.Mollen » June 26th, 2019, 7:33 am

The smart lawyers can comment later but I'm reading now

" the proposition that the Commerce Clause by its own force restricts state protectionism is deeply rooted in our case law. And without the dormant Commerce Clause, we would be left with a constitutional scheme that those who framed and ratified the Constitution would surely find surprising. . . . That is so because removing state trade barriers was a principal reason for the adoption of the Constitution. Under the Articles of Confederation, States notoriously obstructed the interstate shipment of goods. “Interference with the arteries of commerce was cutting off the very lifeblood of the nation.” At that Convention, discussion of the power to regulate interstate commerce was almost uniformly linked to the removal of state trade barriers, see Abel, The Commerce Clause in the Constitutional Convention and in Contemporary Comment, 25 Minn. L. Rev. 432, 470–471 (1941), and when the Constitution was sent to the state conventions, fostering free trade among the States was prominently cited as a reason for ratification. "
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Re: Supreme Court, and wine.

#53 Post by Victor Hong » June 26th, 2019, 7:35 am

It essentially says that state residency requirements for wine retailers violate the interstate commerce clause of the US Constitution.
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Re: Supreme Court, and wine.

#54 Post by Neal.Mollen » June 26th, 2019, 7:39 am

"the developments leading to the adoption of the Twenty-first Amendment have convinced us that the aim of §2 was not to give States a free hand to restrict the importation of alcohol for purely protectionist purposes."
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Re: Supreme Court, and wine.

#55 Post by Chris S p i k e s » June 26th, 2019, 7:40 am

Thanks Victor. Even I could get that. I wanted an interpretation and opinions about where this leads going forward. How is the wine business going to react? How are shippers likely to react? Are state AG's just going to lay down on this?

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Re: Supreme Court, and wine.

#56 Post by Neal.Mollen » June 26th, 2019, 7:40 am

" §2 grants States latitude with respect to the regulation of alcohol, but the Court has repeatedly declined to read §2 as allowing the States to violate the “nondiscrimination principle” that was a central feature of the regulatory regime that the provision was meant to constitutionalize."
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Re: Supreme Court, and wine.

#57 Post by Neal.Mollen » June 26th, 2019, 7:41 am

BOOM!

"The Association resists this reading. Although it concedes (as it must under Granholm) that §2 does not give the States the power to discriminate against out-of-state alcohol products and producers, the Association presses the argument, echoed by the dissent, that a different rule applies to state laws that regulate in-state alcohol distribution. There is no sound basis for this distinction."
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Re: Supreme Court, and wine.

#58 Post by Neal.Mollen » June 26th, 2019, 7:42 am

"The Association’s argument encounters a problem at the outset. The argument concedes that §2 does not shield state laws that discriminate against interstate commerce with respect to the very activity that the provision explicitly addresses—the importation of alcohol. But at the same time, the Association claims that §2 protects something that §2’s text, if read literally, does not cover—laws restricting the licensing of domestic retail alcohol stores. That reading is implausible. Surely if §2 granted States the power to discriminate in the field of alcohol regulation, that power would be at its apex when it comes to regulating the activity to which the provision expressly refers"
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Re: Supreme Court, and wine.

#59 Post by Neal.Mollen » June 26th, 2019, 7:44 am

While Granholm suggested that a three tier system could be imposed constitutionally, it "did not suggest
that §2 sanctions every discriminatory feature that a State may incorporate into its three-tiered scheme. "
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Re: Supreme Court, and wine.

#60 Post by pnitze » June 26th, 2019, 7:45 am

A big win. Justice Alito uses fairly expansive language in the opinion, and it will provide substantial ammunition to attack interstate shipment restrictions imposed by the states. The big distributors and wholesalers will spend millions defending shipment restrictions, and the fight will not be easy, but this opinion helps a lot. I wouldn’t say it’s a slam dunk on that point, but the opinion is more expansive than I would have guessed.
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Re: Supreme Court, and wine.

#61 Post by Neal.Mollen » June 26th, 2019, 7:45 am

While sec 2 allows each State leeway to enact the measures that its citizens believe are appropriate to address the public health and safety effects of alcohol use and to serve other legitimate
interests, . . . it does not license the States to adopt protectionist measures with no demonstrable connection to those interests."
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Re: Supreme Court, and wine.

#62 Post by Mark Golodetz » June 26th, 2019, 7:46 am

I am no lawyer, nor smart, but I read this as curbing state powers not only in discriminating against non state players, but also for consumers to be able to ship into the state. Is this a narrow decision or a wide one?
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Re: Supreme Court, and wine.

#63 Post by Neal.Mollen » June 26th, 2019, 7:47 am

Section 2 gives the States regulatory authority that they would not otherwise enjoy, but as we pointed out in Granholm, “mere speculation” or “unsupported assertions” are insufficient to sustain a law that would otherwise violate the Commerce Clause. 544 U. S., at 490, 492. Where the predominant effect of a law
is protectionism, not the protection of public health or safety, it is not shielded by §2. The provision at issue here expressly discriminates against nonresidents and has at best a highly attenuated relationship to public health or safety"
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Re: Supreme Court, and wine.

#64 Post by pnitze » June 26th, 2019, 7:50 am

My very quick and superficial take is that the fight over interstate shipment is going to be about whether there is a legitimate health and safety interest in states prohibiting importation of alcohol from out of state retailers. The good news for consumers is that the Tennessee wholesalers and retailers provided numerous putative reasons for the residency requirement, including needed to vet the moral character of licensees, and Alito soundly rejected those rationales.
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Re: Supreme Court, and wine.

#65 Post by pnitze » June 26th, 2019, 7:51 am

Mark Golodetz wrote:
June 26th, 2019, 7:46 am
I am no lawyer, nor smart, but I read this as curbing state powers not only in discriminating against non state players, but also for consumers to be able to ship into the state. Is this a narrow decision or a wide one?
In the context of the current Court, which tends to be very narrow gauge in its holdings, I would characterize this decision as about as wide as one could reasonably hope for.
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Re: Supreme Court, and wine.

#66 Post by Neal.Mollen » June 26th, 2019, 7:52 am

I have to run and I want to read this more carefully, but on first read, this looks like as close to a home run as you are ever going to get out of the S Ct. The state retains the right to regulate interstate commerce for safety and health reasons, but the scrutiny such regulation gets is pretty close to strict scrutiny. The state must show that a discriminatory regulation is necessary and narrowly tailored to accomplishing that goal, and that non-discriminatory means weren’t available. As we know, the excuses offered by the industry for restricting interstate shipping fall well short of that goal.

WE WIN!
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Re: Supreme Court, and wine.

#67 Post by pnitze » June 26th, 2019, 7:53 am

The “highly attenuated” language from Alito is very helpful. He is saying that there must be real substance to the purported health and safety interest. It can’t be manufactured to conceal an otherwise protectionist intent.
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Re: Supreme Court, and wine.

#68 Post by cjsavino » June 26th, 2019, 8:12 am

This will go a long way for out of state shippers

“As for the dormant Commerce Clause, the developments leading to the adoption of the Twenty-first Amendment have convinced us that the aim of §2 was not to give States a free hand to restrict the importation of alcohol for purely protectionist purposes”
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Re: Supreme Court, and wine.

#69 Post by Keith Levenberg » June 26th, 2019, 8:13 am

Here is the passage people will want to cite in arguing that Granholm must now be read to cover retail sales as well as winery sales:
The Association and the dissent point out that Granholm repeatedly spoke of discrimination against out-of-state products and producers, but there is an obvious explanation: The state laws at issue in Granholm discriminated against out-of-state producers. See 883 F.3d, at 621. And Granholm never said that its reading of history or its Commerce Clause analysis was limited to discrimination against products or producers. On the contrary, the Court stated that the Clause prohibits state discrimination against all “‘out-of-state economic interests,’” Granholm, 544 U.S., at 472 (emphasis added), and noted that the direct-shipment laws in question “contradict[ed]” dormant Commerce Clause principles because they “deprive[d] citizens of their right to have access to the markets of other States on equal terms.” Id., at 473 (emphasis added). Granholm also described its analysis as consistent with the rule set forth in Bacchus, Brown-Forman Distillers Corp. v. New York State Liquor Authority, 476 U.S. 573 (1986), and Healy that “‘[w]hen a state statute directly regulates or discriminates against interstate commerce, or when its effect is to favor in-state economic interests over out-of-state interests, we have generally struck down the statute without further inquiry.’” Granholm, supra, at 487 (quoting Brown-Forman, supra, at 579; emphasis added).

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Re: Supreme Court, and wine.

#70 Post by Mark Golodetz » June 26th, 2019, 8:18 am

I have always thought there were two outs for the states to comply with any decision to allow unrestricted shipping, and still restrict.

1. Refuse to allow any shipping period. All wine must be picked up at the store.
2. If there are any fees for selling retail within the state, they could charge out of state retailers the same fees.
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Re: Supreme Court, and wine.

#71 Post by K John Joseph » June 26th, 2019, 8:18 am

Neal.Mollen wrote:
June 26th, 2019, 7:18 am
https://www.supremecourt.gov/opinions/1 ... 6_5i36.pdf

Residency requirement unconstitutional
Sadly, the "public health" argument reigns supreme in Texas, will not be affected by the decision...directly...and so I will still lack the ability to receive wine from a retail shop in California. I do wonder if this is a stepping stone to a later ruling precluding selective bans on shipping. I still don't know how Texas can allow direct shipping of wine from California, but not shipping of wine from a California retailer. Oh well. Good for Tennessee.
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Re: Supreme Court, and wine.

#72 Post by K John Joseph » June 26th, 2019, 8:21 am

Neal.Mollen wrote:
June 26th, 2019, 7:52 am
I have to run and I want to read this more carefully, but on first read, this looks like as close to a home run as you are ever going to get out of the S Ct. The state retains the right to regulate interstate commerce for safety and health reasons, but the scrutiny such regulation gets is pretty close to strict scrutiny. The state must show that a discriminatory regulation is necessary and narrowly tailored to accomplishing that goal, and that non-discriminatory means weren’t available. As we know, the excuses offered by the industry for restricting interstate shipping fall well short of that goal.

WE WIN!
Alito's language suggesting the need for a "not attenuated" link between public health and outside sale restrictions is favorable. Maybe Texan wine geeks can sponsor K&L to bring a suit against Texas's ABC.
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Re: Supreme Court, and wine.

#73 Post by Keith Levenberg » June 26th, 2019, 8:29 am

Chris S p i k e s wrote:
June 26th, 2019, 7:29 am
I'd love to hear some of you smart attorneys interpret and opine on the implications of this decision and where things go from here.
more litigation

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Re: Supreme Court, and wine.

#74 Post by T. Melloni » June 26th, 2019, 8:37 am

The 'dormant' Commerce Clause is defined by milk, wine and garbage.
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Re: Supreme Court, and wine.

#75 Post by D@vid Bu3ker » June 26th, 2019, 8:57 am

I am not saying I think this is appropriate, but I could see states saying the "legitimate purpose" is to protect consumers from unscrupulous merchants, e.g. Premier Cru.
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Re: Supreme Court, and wine.

#76 Post by Ethan H » June 26th, 2019, 9:01 am

I thought this graf from Gorsuch's dissent was interesting, in that he hints at the sort of litigation (with less-than-predictable outcomes) that will likely be engendered as a result of today's decision:

What are lower courts supposed to make of this? How much public health and safety benefit must there be to overcome this Court’s worries about protectionism “predominat[ing]”? Does reducing competition in the liquor market, raising prices, and thus reducing demand still count as a public health benefit, as many States have long supposed? And if residency requirements are problematic, what about simple physical presence laws? After all, can’t States “thoroughly investigate applicants” for liquor licenses without requiring them to have a brick-and-mortar store in the State? ... The Court offers lower courts no more guidance than to proclaim delphically that “each variation must be judged based on its own features.”

(emphasis added)
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Re: Supreme Court, and wine.

#77 Post by Jason T » June 26th, 2019, 9:04 am

Neal.Mollen wrote:
June 26th, 2019, 7:39 am
"the developments leading to the adoption of the Twenty-first Amendment have convinced us that the aim of §2 was not to give States a free hand to restrict the importation of alcohol for purely protectionist purposes."
That seems HUGE
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Re: Supreme Court, and wine.

#78 Post by crickey » June 26th, 2019, 9:05 am

Unfortunately, despite the broad language in the reasoning, I think the holding is very narrow (and Keith's prediction of more litigation is accurate). For one thing, the decision does not overturn licensing per se, only discriminatory licensing unrelated to public-health concerns. So it does not necessary say that out-of-state retailers not licensed in a particular state can sell alcohol to a resident of that state.
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Re: Supreme Court, and wine.

#79 Post by Victor Hong » June 26th, 2019, 9:06 am

D@vid Bu3ker wrote:
June 26th, 2019, 8:57 am
I am not saying I think this is appropriate, but I could see states saying the "legitimate purpose" is to protect consumers from unscrupulous merchants, e.g. Premier Cru.
The Federal Trade Commission already exists, meaning that state bodies are redundant at best, and protectionist at worst.
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Re: Supreme Court, and wine.

#80 Post by crickey » June 26th, 2019, 9:07 am

I do also wonder if the states' interest in blocking this kind of sales is not as strong following the out-of-state tax decision. They get to collect their money.
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Re: Supreme Court, and wine.

#81 Post by c fu » June 26th, 2019, 9:12 am

So which big retailer is gonna take up the case for interstate shipping and spend the $$?
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Re: Supreme Court, and wine.

#82 Post by Jason T » June 26th, 2019, 9:16 am

crickey wrote:
June 26th, 2019, 9:07 am
I do also wonder if the states' interest in blocking this kind of sales is not as strong following the out-of-state tax decision. They get to collect their money.
You'd think, but it also will put a sizable dent in their fundraising. Let's be real about which one of those elected politicians care about more.
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Re: Supreme Court, and wine.

#83 Post by Jayson Cohen » June 26th, 2019, 9:16 am

pnitze wrote:
June 26th, 2019, 7:51 am
Mark Golodetz wrote:
June 26th, 2019, 7:46 am
I am no lawyer, nor smart, but I read this as curbing state powers not only in discriminating against non state players, but also for consumers to be able to ship into the state. Is this a narrow decision or a wide one?
In the context of the current Court, which tends to be very narrow gauge in its holdings, I would characterize this decision as about as wide as one could reasonably hope for.
This. And a decisive majority. Very surprising.

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Re: Supreme Court, and wine.

#84 Post by Tomcwark » June 26th, 2019, 9:17 am

YES!

This is big. Here is our analysis.

Tennessee Wine a resounding victory for wine retailer shipping
The opinion in the Tennessee Wine case represents a great victory for retailers that want to ship wine into states across the country.
The Court in its opinion stated some important principles: 1) Granholm is not limited to producers; (2) Section 2 does provide the power to violate the nondiscrimination principle of the Commerce Clause; (3) the Powers of Section 2 of the 21st Amendment applies narrowly.

Granholm is extended
The Court rejected the argument that Granholm is limited to producers. In the Court’s view Granholm prohibits state discrimination against all “‘out-of-state economic interests”. Which means that economic discrimination against out-of-state retailers shipping into the state is unconstitutional. Specifically, it stated that: “And Granholm never said that its reading of history or its Commerce Clause analysis was limited to discrimination against products or producers. On the contrary, the Court stated that the Clause prohibits state discrimination against all “‘out-of-state economic interests,’” Granholm, 544 U. S., at 472 (emphasis added), and noted that the direct-shipment laws in question “contradict[ed]” dormant Commerce Clause principles because they “deprive[d] citizens of their right to have access to the markets of other States on equal terms.”

21st Amendment Section 2 does not allow the state to discriminate against out-of-state interest
Although providing that states have the power to regulate alcohol under Section 2, the Court held that the 21st Amendment can not be used to violate the nondiscrimination principle of the Commerce Clause.

“To summarize, the Court has acknowledged that §2 grants States latitude with respect to the regulation of alcohol, but the Court has repeatedly declined to read §2 as allowing the States to violate the “nondiscrimination principle” that was a central feature of the regulatory regime that the provision was meant to constitutionalize.”

Health, safety, welfare argument
The Court did acknowledge that under Section 2 that the states have an interest in regulating alcohol, but that their means for regulating must be narrowly tailored.

Keep in mind that the state governments backed by the wholesalers will indicate that the Court allows them the latitude to regulate based on safety, health, and welfare reasons. The state may make the argument that allowing retail sales from an entity that it can’t inspect or have reside within its borders, makes it hard to exercise its policing powers.

The obvious juxtaposition is that out-of-state wineries that can’t be inspected, are allowed to deliver without the threat of the health, safety, and welfare to its residents. And as this opinion states, you can’t draw a line between producers and retailers.

Conclusion
The Court firmly stated that Granholm was not limited to producers and that the states can’t utilize the 21st Amendment to violate the nondiscrimination principle of the Commerce Clause. A great day for wine shipping!

It's going to take time for the laws in the 20 or so states that discriminate against wine retailer shipping to change. Wholesalers will want to shut off all shipping from both in-state and out-of-state retailers. The National Association of Wine Retailers, Wine Freedom and consumers will resist this. There may be other court battles. However, this decision changes things. It's a big day for consumers.
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Re: Supreme Court, and wine.

#85 Post by D@vid Bu3ker » June 26th, 2019, 9:21 am

Gorsuch's dissent is a nauseating read.
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Re: Supreme Court, and wine.

#86 Post by Jayson Cohen » June 26th, 2019, 9:22 am

Keith Levenberg wrote:
June 26th, 2019, 8:29 am
Chris S p i k e s wrote:
June 26th, 2019, 7:29 am
I'd love to hear some of you smart attorneys interpret and opine on the implications of this decision and where things go from here.
more litigation
For sure. But the principles now tying rights under the Dormant CC to out-of-state economic interests and actors in the 21st amendment analysis are as broad as possible. The fight now shifts almost entirely to legitimate state police powers that might justify discrimination against out of state economic actors.

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Re: Supreme Court, and wine.

#87 Post by Ian Dorin » June 26th, 2019, 9:53 am

Tomcwark wrote:
June 26th, 2019, 9:17 am
YES!

This is big. Here is our analysis.

Tennessee Wine a resounding victory for wine retailer shipping
The opinion in the Tennessee Wine case represents a great victory for retailers that want to ship wine into states across the country.
The Court in its opinion stated some important principles: 1) Granholm is not limited to producers; (2) Section 2 does provide the power to violate the nondiscrimination principle of the Commerce Clause; (3) the Powers of Section 2 of the 21st Amendment applies narrowly.

Granholm is extended
The Court rejected the argument that Granholm is limited to producers. In the Court’s view Granholm prohibits state discrimination against all “‘out-of-state economic interests”. Which means that economic discrimination against out-of-state retailers shipping into the state is unconstitutional. Specifically, it stated that: “And Granholm never said that its reading of history or its Commerce Clause analysis was limited to discrimination against products or producers. On the contrary, the Court stated that the Clause prohibits state discrimination against all “‘out-of-state economic interests,’” Granholm, 544 U. S., at 472 (emphasis added), and noted that the direct-shipment laws in question “contradict[ed]” dormant Commerce Clause principles because they “deprive[d] citizens of their right to have access to the markets of other States on equal terms.”

21st Amendment Section 2 does not allow the state to discriminate against out-of-state interest
Although providing that states have the power to regulate alcohol under Section 2, the Court held that the 21st Amendment can not be used to violate the nondiscrimination principle of the Commerce Clause.

“To summarize, the Court has acknowledged that §2 grants States latitude with respect to the regulation of alcohol, but the Court has repeatedly declined to read §2 as allowing the States to violate the “nondiscrimination principle” that was a central feature of the regulatory regime that the provision was meant to constitutionalize.”

Health, safety, welfare argument
The Court did acknowledge that under Section 2 that the states have an interest in regulating alcohol, but that their means for regulating must be narrowly tailored.

Keep in mind that the state governments backed by the wholesalers will indicate that the Court allows them the latitude to regulate based on safety, health, and welfare reasons. The state may make the argument that allowing retail sales from an entity that it can’t inspect or have reside within its borders, makes it hard to exercise its policing powers.

The obvious juxtaposition is that out-of-state wineries that can’t be inspected, are allowed to deliver without the threat of the health, safety, and welfare to its residents. And as this opinion states, you can’t draw a line between producers and retailers.

Conclusion
The Court firmly stated that Granholm was not limited to producers and that the states can’t utilize the 21st Amendment to violate the nondiscrimination principle of the Commerce Clause. A great day for wine shipping!

It's going to take time for the laws in the 20 or so states that discriminate against wine retailer shipping to change. Wholesalers will want to shut off all shipping from both in-state and out-of-state retailers. The National Association of Wine Retailers, Wine Freedom and consumers will resist this. There may be other court battles. However, this decision changes things. It's a big day for consumers.
Tom, NPR put out that this ruling could also change the limits on who can acquire a license, and that TN won't be allowed to place limits, thus allowing large chains to come in. Is this also true?
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Re: Supreme Court, and wine.

#88 Post by Mike Evans » June 26th, 2019, 10:17 am

I suspect that it will be harder for wholesalers and retailers to build coalitions supporting anti-shipping measures now that Wayfair has significantly undercut the lost tax revenue argument.

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Re: Supreme Court, and wine.

#89 Post by Tomcwark » June 26th, 2019, 10:18 am

Ian Dorin wrote:
June 26th, 2019, 9:53 am
Tomcwark wrote:
June 26th, 2019, 9:17 am
YES!

This is big. Here is our analysis.

Tennessee Wine a resounding victory for wine retailer shipping
The opinion in the Tennessee Wine case represents a great victory for retailers that want to ship wine into states across the country.
The Court in its opinion stated some important principles: 1) Granholm is not limited to producers; (2) Section 2 does provide the power to violate the nondiscrimination principle of the Commerce Clause; (3) the Powers of Section 2 of the 21st Amendment applies narrowly.

Granholm is extended
The Court rejected the argument that Granholm is limited to producers. In the Court’s view Granholm prohibits state discrimination against all “‘out-of-state economic interests”. Which means that economic discrimination against out-of-state retailers shipping into the state is unconstitutional. Specifically, it stated that: “And Granholm never said that its reading of history or its Commerce Clause analysis was limited to discrimination against products or producers. On the contrary, the Court stated that the Clause prohibits state discrimination against all “‘out-of-state economic interests,’” Granholm, 544 U. S., at 472 (emphasis added), and noted that the direct-shipment laws in question “contradict[ed]” dormant Commerce Clause principles because they “deprive[d] citizens of their right to have access to the markets of other States on equal terms.”

21st Amendment Section 2 does not allow the state to discriminate against out-of-state interest
Although providing that states have the power to regulate alcohol under Section 2, the Court held that the 21st Amendment can not be used to violate the nondiscrimination principle of the Commerce Clause.

“To summarize, the Court has acknowledged that §2 grants States latitude with respect to the regulation of alcohol, but the Court has repeatedly declined to read §2 as allowing the States to violate the “nondiscrimination principle” that was a central feature of the regulatory regime that the provision was meant to constitutionalize.”

Health, safety, welfare argument
The Court did acknowledge that under Section 2 that the states have an interest in regulating alcohol, but that their means for regulating must be narrowly tailored.

Keep in mind that the state governments backed by the wholesalers will indicate that the Court allows them the latitude to regulate based on safety, health, and welfare reasons. The state may make the argument that allowing retail sales from an entity that it can’t inspect or have reside within its borders, makes it hard to exercise its policing powers.

The obvious juxtaposition is that out-of-state wineries that can’t be inspected, are allowed to deliver without the threat of the health, safety, and welfare to its residents. And as this opinion states, you can’t draw a line between producers and retailers.

Conclusion
The Court firmly stated that Granholm was not limited to producers and that the states can’t utilize the 21st Amendment to violate the nondiscrimination principle of the Commerce Clause. A great day for wine shipping!

It's going to take time for the laws in the 20 or so states that discriminate against wine retailer shipping to change. Wholesalers will want to shut off all shipping from both in-state and out-of-state retailers. The National Association of Wine Retailers, Wine Freedom and consumers will resist this. There may be other court battles. However, this decision changes things. It's a big day for consumers.
Tom, NPR put out that this ruling could also change the limits on who can acquire a license, and that TN won't be allowed to place limits, thus allowing large chains to come in. Is this also true?
It's certainly true that a state cannot stop new retail openings in a state based on the notion that they must be residents for a certain amount of time or require that their owners or shareholders live in a state. This decision will benefit the chains, of which I think there are essentially two or three.
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Re: Supreme Court, and wine.

#90 Post by Tomcwark » June 26th, 2019, 10:20 am

Mike Evans wrote:
June 26th, 2019, 10:17 am
I suspect that it will be harder for wholesalers and retailers to build coalitions supporting anti-shipping measures now that Wayfair has significantly undercut the lost tax revenue argument.
Yes. That and the fact that the Supreme Court just said that discriminatory laws must serve the purposes of health and safety of a state and that such claims must come with real evidence. But here's what you can expect: Wholesalers and Retailers will attempt to pass laws that ban shipments from both in-state and out-of-state retailers so that there is no discrimination. We will likely see this happen sooner rather than later in places like Michigan, Illinois and Texas.
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Re: Supreme Court, and wine.

#91 Post by crickey » June 26th, 2019, 10:38 am

Tomcwark wrote:
June 26th, 2019, 10:20 am
Mike Evans wrote:
June 26th, 2019, 10:17 am
I suspect that it will be harder for wholesalers and retailers to build coalitions supporting anti-shipping measures now that Wayfair has significantly undercut the lost tax revenue argument.
Yes. That and the fact that the Supreme Court just said that discriminatory laws must serve the purposes of health and safety of a state and that such claims must come with real evidence. But here's what you can expect: Wholesalers and Retailers will attempt to pass laws that ban shipments from both in-state and out-of-state retailers so that there is no discrimination. We will likely see this happen sooner rather than later in places like Michigan, Illinois and Texas.
I don't think that sort of ban would survive under this ruling, as such a rule would effectively prohibit out-of-state retailers from selling in that state.
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Re: Supreme Court, and wine.

#92 Post by David McMillen » June 26th, 2019, 10:42 am

Tom, NPR put out that this ruling could also change the limits on who can acquire a license, and that TN won't be allowed to place limits, thus allowing large chains to come in. Is this also true?
I am certainly no lawyer but I live in Nashville and my understanding is that current TN law only allows a person or entity to own 2 retail licenses, so that one person or company can only own up to 2 stores in the state. This law (if I am correct) would have to change before the chains would move in.

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Re: Supreme Court, and wine.

#93 Post by Alan Rath » June 26th, 2019, 10:50 am

D@vid Bu3ker wrote:
June 26th, 2019, 8:57 am
I am not saying I think this is appropriate, but I could see states saying the "legitimate purpose" is to protect consumers from unscrupulous merchants, e.g. Premier Cru.
If so, then they'd have to ban Nugenix commercials [wow.gif]
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Re: Supreme Court, and wine.

#94 Post by Alan Rath » June 26th, 2019, 10:53 am

So which of the justices buy wine from out of state retailers? ;)
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Re: Supreme Court, and wine.

#95 Post by Jayson Cohen » June 26th, 2019, 12:05 pm

crickey wrote:
June 26th, 2019, 10:38 am
Tomcwark wrote:
June 26th, 2019, 10:20 am
Mike Evans wrote:
June 26th, 2019, 10:17 am
I suspect that it will be harder for wholesalers and retailers to build coalitions supporting anti-shipping measures now that Wayfair has significantly undercut the lost tax revenue argument.
Yes. That and the fact that the Supreme Court just said that discriminatory laws must serve the purposes of health and safety of a state and that such claims must come with real evidence. But here's what you can expect: Wholesalers and Retailers will attempt to pass laws that ban shipments from both in-state and out-of-state retailers so that there is no discrimination. We will likely see this happen sooner rather than later in places like Michigan, Illinois and Texas.
I don't think that sort of ban would survive under this ruling, as such a rule would effectively prohibit out-of-state retailers from selling in that state.
I don’t think this is right as such a statute does not facially discriminate.

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Re: Supreme Court, and wine.

#96 Post by crickey » June 26th, 2019, 12:17 pm

Jayson Cohen wrote:
June 26th, 2019, 12:05 pm
crickey wrote:
June 26th, 2019, 10:38 am
Tomcwark wrote:
June 26th, 2019, 10:20 am


Yes. That and the fact that the Supreme Court just said that discriminatory laws must serve the purposes of health and safety of a state and that such claims must come with real evidence. But here's what you can expect: Wholesalers and Retailers will attempt to pass laws that ban shipments from both in-state and out-of-state retailers so that there is no discrimination. We will likely see this happen sooner rather than later in places like Michigan, Illinois and Texas.
I don't think that sort of ban would survive under this ruling, as such a rule would effectively prohibit out-of-state retailers from selling in that state.
I don’t think this is right as such a statute does not facially discriminate.
The dormant commerce clause covers both direct discrimination and where the effect is to discriminate in favor of in-state interests. Preventing someone from selling into a state because they don't have a physical location there has the effect of discriminating in favor of a person who does have a physical location there. It's not hugely different from the present case, where the license would only be granted to someone who was a Tennessee resident.
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Re: Supreme Court, and wine.

#97 Post by mmarcellus » June 26th, 2019, 12:22 pm

Tomcwark wrote:
June 26th, 2019, 10:20 am
Mike Evans wrote:
June 26th, 2019, 10:17 am
I suspect that it will be harder for wholesalers and retailers to build coalitions supporting anti-shipping measures now that Wayfair has significantly undercut the lost tax revenue argument.
Yes. That and the fact that the Supreme Court just said that discriminatory laws must serve the purposes of health and safety of a state and that such claims must come with real evidence. But here's what you can expect: Wholesalers and Retailers will attempt to pass laws that ban shipments from both in-state and out-of-state retailers so that there is no discrimination. We will likely see this happen sooner rather than later in places like Michigan, Illinois and Texas.
Maybe that could succeed in Illinois and Texas (though heaven knows that IL could use the additional tax revenue). However, such a measure in Michigan would hit the local wine industry hard. There would definitely be strong resistance beyond the urban wine swilling demographic.
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Re: Supreme Court, and wine.

#98 Post by Ethan H » June 26th, 2019, 12:27 pm

crickey wrote:
June 26th, 2019, 12:17 pm
The dormant commerce clause covers both direct discrimination and where the effect is to discriminate in favor of in-state interests. Preventing someone from selling into a state because they don't have a physical location there has the effect of discriminating in favor of a person who does have a physical location there. It's not hugely different from the present case, where the license would only be granted to someone who was a Tennessee resident.
I haven't read Granholm in years, but this quote from Gorsuch's dissent today would seem to undercut that proposition:

Granholm held that the Twenty-first Amendment does not protect laws that discriminate against out-ofstate products, but it also expressly reaffirmed the “‘unquestionabl[e] legitima[cy]’” of state laws that require “‘all liquor sold for use in the State [to] be purchased from a licensed in-state wholesaler.’”
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Re: Supreme Court, and wine.

#99 Post by John Morris » June 26th, 2019, 12:46 pm

Alan Rath wrote:
June 26th, 2019, 10:53 am
So which of the justices buy wine from out of state retailers? ;)
Since most of them are Catholic, we can assume they drink.
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Re: Supreme Court, and wine.

#100 Post by crickey » June 26th, 2019, 12:47 pm

Ethan H wrote:
June 26th, 2019, 12:27 pm
crickey wrote:
June 26th, 2019, 12:17 pm
The dormant commerce clause covers both direct discrimination and where the effect is to discriminate in favor of in-state interests. Preventing someone from selling into a state because they don't have a physical location there has the effect of discriminating in favor of a person who does have a physical location there. It's not hugely different from the present case, where the license would only be granted to someone who was a Tennessee resident.
I haven't read Granholm in years, but this quote from Gorsuch's dissent today would seem to undercut that proposition:

Granholm held that the Twenty-first Amendment does not protect laws that discriminate against out-ofstate products, but it also expressly reaffirmed the “‘unquestionabl[e] legitima[cy]’” of state laws that require “‘all liquor sold for use in the State [to] be purchased from a licensed in-state wholesaler.’”
The reason I am less enthused about today's ruling than others in this thread is that I do not read it to have eliminated the licensing requirement or to permit a retailer licensed in one state to sell to any state. It did not undercut the licensing requirement. It just said that the requirements to obtain a license in a state cannot discriminate in favor of residents of that state.

My point about the shipping ban, even applied within a state, is that it would effectively restrict the sale of alcohol within a state to retailers physically located in the state, which appears to be contrary to the holding in this case.

I am curious to know how this ruling will impact states that restrict the sale of alcohol to state-owned stores.
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