Thank you for sharing!

Your article was successfully shared with the contacts you provided.
The Supreme Court may decide soon whether the battle over interstate shipment of wine to consumers is ready to uncork and add to its docket. The Court will consider at its private Thursday conference three petitions challenging two conflicting rulings on the issue, which pits the Constitution’s commerce clause against the 21st Amendment. That amendment ended Prohibition in 1933 and gave states power to regulate the transport of alcoholic beverages. The cases are two among dozens the justices will consider at the conference with an eye toward granting review and adding some to their docket for the fall term. Opposing factions in the wine import battle have enlisted marquee legal talent, including Kenneth Starr of Kirkland & Ellis; Louis Cohen and C. Boyden Gray of Wilmer Cutler Pickering; Miguel Estrada of Gibson, Dunn & Crutcher; former Supreme Court nominee Robert Bork; Clint Bolick of the Institute for Justice; and former Bush Justice Department official Viet Dinh, now a professor at Georgetown University Law Center. The stakes are high for U.S. wineries, whose expansion into Internet sales to consumers has been slowed by a patchwork of state restrictions. The case is also vital for states and distributors who fear the loss of tax and sales revenue if state regulation is relaxed. Litigation over the issue is under way in nearly half the states, and about the same number impose restrictions on shipment of wine directly to consumers from out-of-state. In Granholm v. Heald, No. 03-1116, and a companion case, Michigan Beer & Wine Wholesalers Association v. Heald, No. 03-1120, the state of Michigan and beer and wine wholesalers challenge a ruling by the 6th U.S. Circuit Court of Appeals striking down the state’s ban on alcohol imports. The 6th Circuit ruling, written by Judge Margaret Daughtrey, analyzed the 21st Amendment, but rejected the view that “a state’s ‘virtually complete control’ over liquor regulation enables it to discriminate against out-of-state interests in favor of in-state interests.” Daughtrey, joined by Chief Judge Danny Boggs and Judge Ralph Guy Jr., said the Supreme Court’s recent jurisprudence had moved away from a broad interpretation of state power under the 21st Amendment. Michigan, in its appeal from the ruling tells the Supreme Court that regulating out-of-state shipments to its consumers is one of the state’s “core functions” under the 21st Amendment. “By requiring that alcoholic beverages only be sold to consumers by responsible, accountable and licensed in-state retailers,” writes state Solicitor General Thomas Casey, “this Michigan law provides for an orderly, controlled market in which liquor, a potentially dangerous and frequently abused substance, is not delivered into the wrong hands and ensures that all such transactions are taxed and uniformly regulated.” The wholesalers, represented by Anthony Kogut of Willingham & Cote of East Lansing, Mich., and Wilmer Cutler, warn of “import alcohol anarchy” in Michigan if the 6th Circuit is upheld. Bork and Dinh are also working with wholesaler groups. A coalition of 35 states has also filed a brief siding with Michigan. “The possibility that federal courts may eviscerate the states’ ability to maintain their liquor control systems is of paramount concern to all states,” wrote Ohio State Solicitor Douglas Cole for the states, On the other side, a group of Michigan consumers and others are represented by Indiana University School of Law professor James Tanford, as well as by Starr. Surveying several other rulings on the issue — some similar to the 6th Circuit’s and some seeming to conflict — the consumers’ brief urges the Court to wait for additional litigation and legislative changes to proceed before intervening. “There is no need to weigh in now — or to weigh in here,” the brief concludes. “These cases are more like a 2000 Bordeaux than a 1961.” In reply, the wholesalers assert that with six circuits ruling on the issue, it is “ripe for review.” The 2nd and 7th circuits have ruled in favor of state regulation, while the 4th, 5th, 6th, and 11th have ruled that the commerce clause’s discouragement of state-imposed trade barriers trumps the states’ 21st Amendment powers. The 2nd Circuit ruling in favor of the state of New York’s import restriction is before the high court in the other case to be discussed May 13, Swedenburg v. Kelly. In his appeal on behalf of Virginia vintner Juanita Swedenburg, Institute for Justice’s Bolick tells the justices that “unless this Court reviews the decision below, the trade barriers that artificially constrict wine commerce in half the states will persist and the vast commercial promise of our technological era will be arrested.” The 2nd Circuit in February found that the New York restriction on wine import “serves valid regulatory interests,’ not “mere economic protectionism.” Circuit Judge Richard Wesley wrote the ruling, joined by Judges Jon Newman and Sonia Sotomayor. New York state, in a brief by state Solicitor General Caitlin Halligan, agrees that the high court should review both Swedenburg and the Michigan appeal to resolve a circuit split that “appears irreconcilable and is quickly deepening.” Also filing a brief in Swedenburg in favor of the New York law is Gibson Dunn’s Estrada, representing four New York wine wholesalers, an association of retailers, and a local of the Allied Food and Commercial Workers International Union that represents liquor salespeople. Estrada argues that challenges to longstanding alcohol regulatory schemes “raise serious federalism concerns.” OTHER CASES UP FOR REVIEWThomson Inc. v. United States, No. 03-882. Constitutionality of selected exemptions from harbor maintenance tax. � Gross Seed Co. v. Department of Transportation, No. 03-960 (and similar case Sherbrooke Turf Inc. v. Minnesota Department of Transportation, No. 03-968.) Whether affirmative action provisions of Transportation Equity Act for the 21st Century violate equal protection clause of Fifth Amendment. � Los Angeles News Service v. Reuters Television International Ltd., No. 03-965. Damages for foreign infringements of copyright. � Crawford v. Riveron-Aguilera, No. 03-1265. Whether Mariel Cubans, detained by the United States since 1999 as criminal aliens, must be released. � Lohrenz v. Donnelly, No. 03-1272. When must an ostensibly private figure be regarded as a public figure under defamation law. � Herring v. Crosby, No. 03-1284. How an advisory jury opinion favoring the death penalty in a murder case should be treated under Ring v. Arizona. � UNUM Life Insurance Company of America v. Tierney, No. 03-1299. Whether an employee benefit plan in which the only participants are non-employees, such as owners or partners, is governed by ERISA. This column seeks to identify cases on the Supreme Court’s conference agenda that are leading candidates for Supreme Court review or that raise significant national issues. Thomas Goldstein of Washington, D.C.’s Goldstein & Howe selects these cases from the many petitions filed based on several factors, including whether lower courts have split on the issues presented. He does not otherwise participate in the preparation of this column.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.