The 21st Amendment to the Constitution says that the “transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited.” The Commerce Clause of the US Constitution says that Congress has the power to regulate trade between the states. Through many decisions over the years, the Commerce Clause has also been interpreted to mean that states are not allowed to establish anti-competitive practices: states were not allowed to discriminate against products or trade from another state. In 2005, the Supreme Court ruled in Granholm v Heald that states which allowed direct shipments to consumers from their own in-state wineries and in-state retailers could not prohibit out-of-state wineries and retailers from shipping to consumers. This decision opened the door for direct shipping of wine to many states where before it had never been possible. State legislatures had to choose to either restrict their own in-state industry or allow out-of-state wineries and retailers to fairly participate in their market.
Now, bill H.R. 5034 has been introduced to the US House of Representatives with the direct backing of the National Beer Wholesalers Association. It would prohibit wineries from bringing legal action against states who violate this provision of the Constitution’s Commerce Clause.
We believe that whether you ever order wine from out-of-state or even whether you ever drink alcoholic beverages, it is vital to our country’s economic health that free trade be allowed between states. Please contact your representative and let them know that you oppose HR 5034.
PRESS RELEASE FROM NAPA VALLEY VINTNERS:
In an effort to turn back the clock on the direct shipment of wine to consumers, a bill has been introduced in Congress recently that would, in effect, overturn the 2005 “Granholm v. Heald” U.S. Supreme Court decision that helped pave the way for wineries to ship wine directly to many more consumers around the country.
H.R. 5034, crafted by the National Beer Wholesalers Association would make it practically impossible to bring legal action against states’ wine shipping laws that violate the Constitution’s Commerce Clause by prohibiting wine shipment from out of state, while permitting their own in-state wineries to ship direct. The end result would be a return to discriminatory wine shipping laws within the states, creating economic hardship for wineries that consider direct shipment and important sales channel and greatly restricting choice among wine consumers nationwide.
The NVV believes that consumers in all 50 states should have the ability to directly purchase fine wine. Many medium to small wineries have very limited distribution and garner little attention from the large distributors. These wineries survive by selling wine through mailing lists, wine clubs, and over the internet.
Napa Valley Vintners agree that the existing three-tier system should be augmented, not eliminated, and should provide controls and regulations necessary to respect local laws, avoid underage access and provide provisions to make tax payments. It is not the intent of any winery to sell alcohol to minors or to avoid payment of local, state or federal taxes on their wines.