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Virginia Decision Defends Wine-By-Internet
Daily Policy Digest

State & Local Issues / Limiting Competition & Enterprise

Friday, April 05, 2002
A federal district judge last week declared unconstitutional Virginia's ban on shipments of wine and beer from out of state. Judge Richard Williams declared that the ban is a violation of the Commerce Clause, which mandates free trade between states.

  • In six states it's a felony to ship wine across state borders directly to a consumer -- and 28 states won't let residents ship wine home from an out-of-state vineyard.
  • Because of the crazy quilt of state laws, delivery services such as Fed Ex and UPS won't deliver wine in many states for fear of inadvertently committing and illegal act.
  • Observers say the laws exist largely due to the lobbying efforts of wholesalers who want to preserve the current three-tier system -- which requires producers to sell to in-state wholesalers, who sell to retailers, who sell to consumers.
  • This cozy and forced arrangement effectively denies market access to America's 2,050 small wineries -- who otherwise could employ the Internet to promote sales and delivery of their wares.
Judicial experts predict that cases similar to the one in Virginia will eventually reach the U.S. Supreme Court.

Source: Editorial, "A Vintage Ruling," Wall Street Journal, April 5, 2002.

For WSJ text
http://online.wsj.com/article/
0,,SB1017967371297679000,00.html

For more on Limiting Competition & Enterprise
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