Flash! Supreme Court, 5-4, Backs Winos' Rights!

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Ralph
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Flash! Supreme Court, 5-4, Backs Winos' Rights!

Post by Ralph » Mon May 16, 2005 9:24 am

High court: Ban on out-of-state wine shipments unconstitutional


WASHINGTON (AP) -- 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, which supporters said were aimed at protecting local wineries and limiting underage drinkers from purchasing wine without showing proof of age. In all, 24 states have laws barring interstate shipments.

The court said the state bans are discriminatory and anticompetitive.

"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 in an opinion joined by Justices Antonin Scalia, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer.

The wine industry is booming, with an estimated $21.6 billion in sales and tourists flocking to wineries for tastings and tours. The recent hit movie "Sideways" took a lighthearted look at California's love affair with the grape.

While wineries have proliferated, there also has been consolidation. Smaller wineries 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.

The Supreme Court case centered on 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, allowing state governments to collect millions in alcohol taxes.

But the Constitution also prohibits states from passing laws that discriminate against out-of-state businesses. That led to a challenge to the Michigan and New York laws.

In a dissent, Justice Clarence Thomas argued 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 by Chief Justice William H. Rehnquist and 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.

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.
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Post by jbuck919 » Mon May 16, 2005 10:41 am

My first thought was, will they ship to APO addresses, but then I remembered that decent drinking wines here are dirt cheap compared to the States.

When I lived in Takoma Park, MD, the oldest suburb of Washington, DC, my apartment was on a block that straddled the District of Columbia and Maryland. Every time I walked one block to the liquor store to get a bottle of wine and brought it back, I was breaking the law. In fact, the Maryland police would conduct stings of Maryland consumers driving downtown to stock up on the cheaper stuff available in DC. They would follow the perpetrator back to the border and stop and fine him on the other side.

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Post by Haydnseek » Mon May 16, 2005 10:48 am

Good news for wine producers and drinkers, bad news for retail shops and states like Virginia which gets revenue from its ABC (Department of Alcoholic Beverage Control) stores.
"The law isn't justice. It's a very imperfect mechanism. If you press exactly the right buttons and are also lucky, justice may show up in the answer. A mechanism is all the law was ever intended to be." - Raymond Chandler

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Post by jbuck919 » Mon May 16, 2005 11:08 am

Haydnseek wrote:Good news for wine producers and drinkers, bad news for retail shops and states like Virginia which gets revenue from its ABC (Department of Alcoholic Beverage Control) stores.
That's most if not all of the southeast US, not to mention I know not how much of the rest of the country that I have never visited.

As you know, Maryland was (is?) doubly peculiar because Montgomery County (that's the rich one, folks, with the National Institutes of Health and stuff like that) was allowed to have its own liquor monopoly while the rest of the state adopted the civilized custom of the northeast of leaving sales to private retailers.

There's nothing remarkable about it. All one has to do is hit the right keys at the right time and the instrument plays itself.
-- Johann Sebastian Bach

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Post by Ralph » Mon May 16, 2005 12:15 pm

jbuck919 wrote:
Haydnseek wrote:Good news for wine producers and drinkers, bad news for retail shops and states like Virginia which gets revenue from its ABC (Department of Alcoholic Beverage Control) stores.
That's most if not all of the southeast US, not to mention I know not how much of the rest of the country that I have never visited.

As you know, Maryland was (is?) doubly peculiar because Montgomery County (that's the rich one, folks, with the National Institutes of Health and stuff like that) was allowed to have its own liquor monopoly while the rest of the state adopted the civilized custom of the northeast of leaving sales to private retailers.
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Does PA still have state liquor stores? How about VA? I remember them from Army days.
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Post by Corlyss_D » Mon May 16, 2005 5:06 pm

jbuck919 wrote:When I lived in Takoma Park, MD, the oldest suburb of Washington, DC, my apartment was on a block that straddled the District of Columbia and Maryland.
You used to live in Tacoma Park???? I loved that community.
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Post by Corlyss_D » Mon May 16, 2005 5:10 pm

Ralph wrote:Does PA still have state liquor stores? How about VA? I remember them from Army days.
Yup. Remember it wasn't until late 60s that Va got liquor by the drink. In Va you can get anyting under (I think) 19% alcohol in commercial stores like the grocery. Anything over that has to be had from the ABC stores.
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jbuck919
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Post by jbuck919 » Mon May 16, 2005 6:20 pm

Corlyss_D wrote:
jbuck919 wrote:When I lived in Takoma Park, MD, the oldest suburb of Washington, DC, my apartment was on a block that straddled the District of Columbia and Maryland.
You used to live in Tacoma Park???? I loved that community.
For seven years. It's where I plopped down when I moved from grad school at Yale to the environs of our nation's capital. Loved it to pieces. Cheapo apartment on Eastern Avenue (also junko). Moving to Columbia because of job was culture shock.

Isn't it, er, a little liberal for my Corlyssita? We're talking about a community that voted quite without standing to declare itself a nuclear free zone.

There's nothing remarkable about it. All one has to do is hit the right keys at the right time and the instrument plays itself.
-- Johann Sebastian Bach

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Post by Ralph » Mon May 16, 2005 6:26 pm

jbuck919 wrote:
Corlyss_D wrote:
jbuck919 wrote:When I lived in Takoma Park, MD, the oldest suburb of Washington, DC, my apartment was on a block that straddled the District of Columbia and Maryland.
You used to live in Tacoma Park???? I loved that community.
For seven years. It's where I plopped down when I moved from grad school at Yale to the environs of our nation's capital. Loved it to pieces. Cheapo apartment on Eastern Avenue (also junko). Moving to Columbia because of job was culture shock.

Isn't it, er, a little liberal for my Corlyssita? We're talking about a community that voted quite without standing to declare itself a nuclear free zone.
*****

I researched the records: Corlyss sought a zoning variaance so she could live in a nuclear-free-for-all zone.
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Post by Ralph » Mon May 16, 2005 6:29 pm

Vintners toast ruling on shipping bans
5/16/2005, 8:07 p.m. ET
By MICHELLE LOCKE
The Associated Press

NAPA, Calif. (AP) — Vintners broke out the bubbly Monday and began taking calls from East Coast customers eager to order after the Supreme Court struck down bans on out-of-state wine shipments.

In Northern California, Iron Horse vineyard co-owner Joy Sterling said her phone started ringing at 7:30 a.m. as word of the ruling got out.

"What's exciting is that this evens the playing field," Sterling said.

Sterling can't fill those orders just yet.

Monday's ruling means legislatures in the 24 states barring out-of-state shipments will have to review their laws to make sure in- and out-of-state wineries are treated equally — and states could simply decide to ban all shipments.

Still, vintners were hopeful the ruling would uncork new markets in an industry with an estimated $21.6 billion in sales annually.

The ruling may have the biggest impact on California, which produces 90 percent of the nation's wines. But with all 50 states producing wine in some quantities, it was expected to have a national impact as well.

"It will definitely expand sales opportunities and, just as importantly, expand the reputation of New York wines because now people around the country will finally be able to get them," said Jim Trezise, president of the New York Wine & Grape Foundation.

"It's going to be sort of a snowballing effect: Wine writers will write about our wines, consumers will try them, so the industry will make more of them and that will create more consumers on the other end."

In the 5-4 decision, the high court struck down shipping bans in Michigan and New York, saying it's unconstitutional for a state to allow in-state wineries to ship direct to consumers while stopping out-of-state wineries from doing the same thing.

Although states could respond with outright bans, Robert Koch, president of the San Francisco-based Wine Institute, pointed out that wineries in other states are not likely to favor shutting down all shipments.

At issue is the traditional system in which wineries ship to wholesalers who then ship to restaurants and retailers.

A decade ago, only a handful of states permitted wineries to ship directly to consumers. But the number crept into the mid-20s in recent years, creating a confusing system where some states allow all shipments, some only allow in-state and some ban shipments altogether.

Wholesalers had argued against direct shipping, saying it would trample state rights, cut tax revenues and give teens unprecedented access to alcohol.

Wholesalers weren't giving up the fight yet.

In a statement posted on the Wine & Spirits Wholesalers of America, Inc., Web site, president and CEO Juanita Duggan said the ruling gives states the option of "supporting face-to-face transactions by someone licensed to sell alcohol or opening up the floodgates."

Duggan said WSWA would support strengthening alcohol laws, arguing in-person ID checks are best.

Striking down the bans was expected to have the largest impact on small wineries who aren't big enough for national distribution — and on the wine connoisseurs who love them.

"Those very small wineries — that direct business is their lifeblood," said Kathleen Schumacher, president and CEO of New Vine Logistics, a Napa-based company that specializes in wine shipping.

New Vine shipped a million bottles last year and is on track to double that this year, with almost 30 percent of shipments going to New York wholesalers.

Schumacher was cautious about how Monday's ruling would play out but said if New York decides to allow out-of-state shipments "that would be an enormous impact for us. There's a lot of demand in New York."

The hodgepodge system of wine shipping laws has led to quite a few irritated Wine Country visitors.

"A lot of people aren't aware of it and come in here and they're like — 'What do you mean, you can't ship wine to me!'" said Doug White, tasting room manager of the Vintner's Collective in downtown Napa, which features vintages from several small wineries.

In west-central New York's Finger Lakes, a largely unspoiled setting of lakes, hills and valleys with 92 wineries, most sales are made in tasting rooms. Just a few wineries have become big enough to easily hook up with distributors in other states.

Peter Saltonstall, who owns King Ferry Winery on the eastern slopes above Cayuga Lake, predicted more shipping could put the Finger Lakes "firmly on the wine map." He's already thinking about expanding.

"It's a great day," he said.

•__

Associated Press Writer Ben Dobbin in Rochester, N.Y., contributed to this story.
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Post by Corlyss_D » Mon May 16, 2005 6:52 pm

jbuck919 wrote:For seven years. It's where I plopped down when I moved from grad school at Yale to the environs of our nation's capital. Loved it to pieces. Cheapo apartment on Eastern Avenue (also junko). Moving to Columbia because of job was culture shock.
Columbia! You mean DC or that cheesy new town outside Baltimore.
Isn't it, er, a little liberal for my Corlyssita? We're talking about a community that voted quite without standing to declare itself a nuclear free zone.
When I was in college, me Mum used to go to a very off the wall doctor who lived in Takoma Park. Dr. Aitcheson. Completely loony. A medical doctor, Ph. D. in theology, and a Ph. D. in law. Australian naturalized American. His ticket to practice medicine had been revoked in all 50 states. But he still had his potions. I used to wait for her in the car reading. I loved the area. You'd have to see it to appreciate it's Victorian working class charm. Not toney like Georgetown or Alexandria. Not derelict, like so many of DCs older black neighborhoods. Very much in keeping with the middle class housing of upper north west and north east.

I thought it was funny that they banned the bomb. A sign of puckishness, not substantially different from our Ralph's sense of humor. We must make the world safe for whimsey. I think if I'd lived in Takoma Park, I would have voted for the nuclear-free zone too.
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