US: Supreme Court wine case begins next week
The US Supreme Court will hear oral arguments in cases challenging bans on interstate, direct-to-consumer wine shipments in New York and Michigan next week.
Both states have laws that allow in-state wineries to ship alcohol directly to adult consumers but prohibit out-of-state wineries to direct ship to those same consumers.
The Supreme Court will consider the core legal question: Does the 21st Amendment permit states to discriminate against out-of-state wineries?
At issue is the clash between the 21st Amendment, which gives states the right to regulate alcohol distribution, and the Commerce Clause, which prohibits states from discriminating against out-of-state competitors.
"A favourable decision to end discrimination promoted by wholesalers would be good for wine consumers, regulators and tax collectors in states that pass legalised direct shipping, and a win for America's small family wineries," said Wine Institute president and CEO Robert P. Koch.
"This has already occurred in 26 states and we want New York and Michigan to be numbers 27 and 28. The Wine Institute supports the three-tier producer-wholesaler-retailer distribution system, as 99% of the wine is sold in this manner. Direct shipping augments the three-tier system by allowing small wineries with limited distribution options to do business with their adult consumers."
Battling against any relaxation of the ban are the country's wholesalers, which argue that out-of-state wine shipments will lead to an increase in alcohol abuse and underage drinking.
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