Wine Litigation is Supreme Court Bound

October 2003

Wine Litigation is Supreme Court Bound

By Clint Bolick

As we await a decision from the U.S. Court of Appeals for the 2nd Circuit in our challenge to New York’s ban on direct interstate shipment of wine to consumers, it appears increasingly likely that the issue is headed to the U.S. Supreme Court.

The Court typically takes cases raising important federal constitutional issues when lower appellate courts reach contrary results, referred to as a “circuit split.” In the various challenges to direct shipment bans, appellate courts so far have produced an unusual three-way circuit split:

The 7th Circuit ruled that Indiana’s ban did not violate the Commerce Clause.

The 5th Circuit, in a ruling earlier this year, invalidated Texas’ ban under the Commerce Clause, finding that it was not saved by the state’s power to regulate alcohol under the 21st Amendment. The 6th Circuit subsequently struck down Michigan’s ban.

The 4th Circuit concluded that North Carolina’s prohibition violated the Commerce Clause, but that the proper remedy was not to allow direct interstate shipping but to forbid shipping by in-state wineries—a result greeted with cheers from the liquor distributor monopoly.

Meanwhile, deregulation in Virginia, North Carolina, South Carolina and Texas brought to 25 the number of states that now permit direct interstate wine shipments to consumers.

IJ’s challenge to New York’s law—fiercely resisted by the state’s four leading liquor distributors—is the last to reach an appellate court. That means one of the challenges likely will reach the Supreme Court either in the term that begins this October or the next.

Lawyers in the various cases are coordinating their efforts, working closely with former U.S. Solicitor General Kenneth Starr, who has been retained by a group of small wineries to lend his expertise. IJ has filed amicus curiae briefs supporting plaintiffs in other cases. Defenders of the status quo have retained former White House counsel C. Boyden Gray, Robert Bork and other legal luminaries to defend the monopolies.

Meanwhile, IJ Vice President for Communications John Kramer has launched a major media blitz to raise public consciousness of the issue, reaping major stories in People, The New York Times, National Law Journal and other publications.

Stay tuned as we move forward in our quest to liberate wine from the clutches of a government-sanctioned cartel and to strike a blow for free trade.

Clint Bolick is VP & National Director of State Chapters.

“[The liquor distributors’] brief has something of an Alice-in-Wonderland quality. In it, a quartet of multi-billion-dollar oligopolists accuse the two small winemaker plaintiffs of ‘avarice’ for wanting to sell a few dozen cases of wine directly to consumers in New York. If a picture is worth a thousand words, the spectacle of these wholesalers fighting feverishly to prevent what they refer to as a de minimis amount of wine from entering the state without flowing through their profit-taking grasp is utterly priceless.”—Excerpt from IJ’s Second Circuit brief