The United States Supreme Court ruled today to support interstate wine shipments directly from wineries to consumers. The Court said that state laws banning such shipments are discriminatory and unconstitutional.
“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.
The Coalition for Free Trade is a non-profit organization seeking judicial relief from laws prohibiting direct-to-consumer shipments of wine, and helped coordinate lawsuits in seven states. The Michigan and New York cases were combined and considered by the Supreme Court on December 7, 2004.
According to the Coalition for Free Trade, the ruling will help wineries satisfy growing consumer demand for their wines, rather than being shackled by discriminatory state laws that shut them out of important wine markets. David Stout of the New York Times explains,
Today’s ruling is of intense interest not only to the states – 26 of which already allow direct shipment from out-of-state wineries – but also to the wholesale liquor industry, which fears eventually being left out of what is now a state-run three-tier system: liquor producer to licensed wholesaler to licensed retailer.
The worry for liquor wholesalers has been that if the justices ruled that consumers could buy wine directly from out-of-state producers, so might liquor retailers be able to do so, at least in theory.
“It is an historic day for the U.S. wine industry,” said Paul Kronenberg, president of Family Winemakers of California. “The only way that most small wineries can survive economically is to open up new markets and that means shipping directly to consumers.”
According to a press release, the next step is for legislators in the affected states to pass the existing model direct shipping bill, which was recommended for adoption by the National Conference of State Legislatures’ Task Force on the Wine Industry in 1997. The model bill has been working successfully in states from Nevada to Virginia; its provisions require an out-of-state winery to purchase a direct shipping license from the state, pay both excise and sales taxes, limit shipments, mark boxes, and consent to the jurisdiction of the state issuing the license.
The Supreme Court’s decision is final and puts an end to an eight year legal battle between wine consumers, who want to purchase wines directly from wineries, and the wine wholesalers.
Chris is a staff writer for murdok. Visit murdok for the latest ebusiness news.
