WTSO no longer shipping to Texas

It has been my impression that since 2010, out of state retailers were prohibited from shipping to Texas. I know Carrie and Randy told me they couldn’t ship to Texas because they had received their letter from TABC. I tried to get some wine from Cinderella around that time and was told no dice as well.

Out-of-State Retailers
Updated August 10, 2010
Siesta Village / Wine Country Gift Baskets Ruling

Background

A lawsuit was filed in U.S. District Court on April 3, 2006, challenging the constitutionality of certain provisions of the Alcoholic Beverage Code and seeking an injunction barring their enforcement. The lawsuit claimed that sections of the Code discriminate against interstate commerce, and violate the Interstate Commerce Clause, by authorizing in-state wine retailers to ship wine directly to Texas consumers while denying out-of-state wine retailers the same right.

District Court Ruling in January 2008 (Later Reversed on Appeal)

On January 14, 2008, a final order was issued in the twin cases of Siesta Village v. Steen and Wine Country Gift Baskets v. Steen. The judge declared certain aspects of the Alcoholic Beverage Code unconstitutional, enjoining the enforcement of those laws. Among other things, the judge ruled that out-of-state retailers are eligible to apply for, and receive, a Texas retailer permit authorizing them to sell and ship wine directly to Texas consumers.

The judge ruled that once receiving the permit, out-of-state retailers must also abide by relevant Texas laws, such as the one that mandates that all retailers purchase their product from a Texas wholesaler or Texas winery. In turn, they are then able to do whatever the law allows Texas retailers to do, such as shipping wine directly to consumers in Texas.

Following the district court ruling, TABC made an Out of State Wine Only Package Store Permit available to out of state retailers. However, no permits were ever issued.

Reversed on Appeal in January 2010 (But Mandate not Issued)

On January 26, 2010, a three member panel of the 5th Circuit Court of Appeals reversed the district court’s ruling that invalidated state provisions that only retailers with a physical presence in Texas could deliver to consumers in Texas. In other words, the appeals court ruled that the Texas laws that allow in-state retailers to deliver, but NOT out-of-state retailers, is not a violation of the Interstate Commerce Clause of the US Constitution. The State of Texas CAN prohibit out-of-state retailers from shipping wine to Texas consumers. TABC is not required to offer a permit to out-of-state retailers.

The appeals court said that the Interstate Commerce Clause and the Granholm decision intend to prevent discrimination against out of state producers and products, which means states can’t discriminate against out-of-state wineries. However, this does not protect out-of-state retailers.

As a result of the appellate court’s ruling, Texas laws prohibiting out-of-state wine retailers from shipping wine directly to Texas consumers violate neither the Commerce Clause of the U.S. Constitution nor the Supreme Court’s decision in Granholm.

Then, I am wrong.

This piece of the blurb is so worrying –

out-of-state retailers must also abide by relevant Texas laws, such as the one that mandates that all retailers purchase their product from a Texas wholesaler or Texas winery. In turn, they are then able to do whatever the law allows Texas retailers to do, such as shipping wine directly to consumers in Texas.

No way any of the out of state retailers purchase from Texas wholesalers. They’re their own importer/distributors in a lot of cases. Texas alcohol laws are horrible.

Someone posted on another forum that WTSO got a C&D regarding shipping to Illinois last month. Wonderful!

The TABC started sending C&D letters several years ago but started with the highest volume violators. In mid 2011 they started getting a periodic list of all retailers violating the law from both UPS and Fedex and the number of shipments. They have been going down the list ever since so I guess WTSO finally made it to the top of the list.

As a wine drinker from Illinois, I have been following these events within my state for a couple of years now. A couple of thoughts:

  1. Regarding WTSO and your pending orders, I contacted them last month when I received a similar email about not shipping to Illinois. They told me that my pending orders will still ship on my preferred date, but that no new orders would be honored. My orders are supposed to ship on Monday, so I’ll let you know if I don’t get shipping notifications for some reason, in which case I would expect full refunds on my purchases.

  2. This is an issue thought could become ripe for Supreme Court intervention. It sounds from some of the above posts as if Texas has already ruled that retail shipping into their state IS a violation of the ICC. A lawsuit was filed in Illinois in September 2016 regarding this very issue as it pertains to the state of Illinois (Wine Retailers Throw Down Gauntlet Against Direct-Shipping Restrictions | Wine Spectator). If the finding in this Illinois suit is that direct retail shipping is NOT a violation of ICC (and therefore cannot be restricted by the state), we have two US states with two opposing interpretations of the US Constitution. One would imagine that someone in one of the restricted states would take this to the Supreme Court for clarification, and this is exactly how the issue of DTC shipping from wineries arrived at the Supreme Court in 2005 (Granholm v. Heald - Wikipedia).

  3. I suspect that with the Illinois and Missouri shipping law changes in September, WTSO probably reviewed the DTC shipping laws for all of the states to tighten up their practices and limit their liabilities. If so, I’d bet that they realized that Texas has been a no-go for years, and they’re just getting around to it now. I have no evidence for this though, it’s just a suspicion.

I wonder if it was a C&D or a voluntary policy change. I got an email from WTSO the day after our Illinois governor signed the bill into law. In Illinois, the big problem is that the new law makes it a Class 4 felony for a retailer to ship wine into our state. I’m sure this got every retailers attention nationwide.

Interestingly, I emailed B-21 the following day because I have my 2015 Bordeaux futures with them. Their response was that they were aware of the changes and they had no plans to alter their shipping practices.

The original Granholm decision was extremely limited, and Texas is obviously going to support the three tier system and ban them imports because there is nothing in the SCOTUS ruling to prevent it.