NCPA - National Center for Policy Analysis

Court Cases Challenge Wine-Shipment Laws

December 23, 1999

With the advent of e-commerce, the potential for buying and selling wine interstate has exploded. The trouble, however, is that most states -- at the behest of alcohol retailers -- don't allow it. So alcoholic-beverage-control boards across the nation are cracking down on violators.

But some of the nation's 2,000 wine-makers are fighting back. They are filing suits to try to overturn alcohol regulations that ban direct shipment to consumers.

For example, two consumers and three out-of-state wineries recently filed suit in Virginia -- one of the plaintiffs being Clint Bolick of the Institute for Justice. Bolick notes that the laws "have nothing to do with promoting temperance and everything to do with protecting the parochial interests of liquor distributors."

  • At present, only 13 states allow wine to be shipped directly to consumers in other states.
  • Following Prohibition, the alcohol industry was structured in a mandated three-tier system under which producers make the product, sell it to distributors, who then sell it to retailers.
  • But smaller wineries do not have the volume to attract -- or be able to afford -- a wholesaler or distributor.
  • Wholesalers contend that states are allowed to regulate the sale of alcohol under the 21st Amendment to the Constitution. But wine groups argue that the laws violate the interstate commerce clause of the Constitution, which says that states may not regulate interstate commerce.

Wholesalers also maintain that allowing wine to be ordered over the Internet would make it easier for those underage to obtain alcohol.

Source: Julie Hyman, "Selling of Wine on Line Uncorks Shipment Ire," Washington Times, December 23, 1999.


Browse more articles on Tax and Spending Issues