US: Supreme Court decides on interstate wine sales
The US Supreme Court has ruled in favour of interstate wine shipments. The move, which has been discussed in court since December last year and focused on New York and Michigan states, has been welcomed by wineries across the country.
The High Court reasoned yesterday (16 May) that state laws banning direct shipments from wineries to consumers are discriminatory and, therefore, unconstitutional. The decision caps an eight-year legal wine war that has pitted wine consumers and makers against wholesalers.
"In this David versus Goliath battle, the ruling is a triumph for America's family wine farmers," said W. Reed Foster, president of the Coalition for Free Trade and chairman emeritus of Ravenswood Winery.
New York and Michigan, the third and tenth largest wine consuming states in the US, can now join 27 other states that allow for direct shipping of wine to consumers.
"This is a major victory in the 20-year battle to end discrimination against America's small, family wineries that want to provide consumers with access to the wines of their choice," said Robert P. Koch, president and CEO of Wine Institute, the trade association of California wineries. "The states of New York and Michigan can now choose to enjoy increased tax revenues from a more diverse and orderly wine market by adopting legislation similar to that which currently benefits consumers in the majority of states."
The ruling now forces US states to decide whether to allow everyone or no one to sell alcohol through the mail or over the Internet.
In a statement, the president and CEO of Wine and Spirits Wholesalers of America, Juanita D. Duggan, said: "The Court today affirmed a state's right to regulate the sale and distribution of alcohol and said in doing so they must treat in-state, out-of-state and presumably out-of-country producers all the same.
"That means states have a choice between supporting face-to-face transactions by someone licensed to sell alcohol or opening up the floodgates."
Twenty years ago, no states allowed direct shipments from out-of-state wineries to adult consumers. By late 2004, 26 states allowed such shipments, including four states that changed in 2003. North Carolina, South Carolina and Virginia were opened through legislative changes, and Texas' ban on shipments was ruled unconstitutional by the 5th US Circuit Court of Appeals.
The next step is for affected states to pass the existing model direct shipping bill, which is operating successfully in a number of states and was recommended for adoption by the National Conference of State Legislatures' Task Force on the Wine Industry, in 1997.
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