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Victory for Wine Consumers & Small Wineries In New York Wine Lawsuit

Washington, D.C.-A federal judge today declared New York state’s laws barring the interstate direct shipment of wine into New York unconstitutional. The Honorable Richard Berman of the U.S. District Court for the Southern District of New York ruled New York could not discriminate against out-of-state wineries who want to ship to in-state consumers. New York had barred out-of-state wineries from shipping to New York consumers while in-state wineries were under no such restriction.

The judge stated, “Defendants contend (unconvincingly) that New York’s [Alcohol Beverage Control] ABC Law ‘erects no barrier to the flow of goods and imposes no burden on interstate commerce.’”

He went on to write, “The evidence here demonstrates, upon summary judgment, that the exceptions to the ABC Law provide an impermissible economic benefit and (protection) to only in-state interests—but also that there are nondiscriminatory alternatives available. Indeed, the Defendants explicitly concede the exceptions were intended to be protectionist.”

Clint Bolick, vice president for the Institute for Justice, which litigated the case, said, “This is a decisive victory against the monopolists who would stand between consumers and their wine. It should have widespread ramifications not only for wine but for all Internet commerce. This is an occasion to pop some corks in celebration of an important decision for consumers.”

“It is wonderful that the judge has read the Constitution and has applied it in my case,” said Juanita Swedenburg, a Virginia vintner who is the lead plaintiff in the lawsuit. “With this decision, the consumers win. I have long-lost the New York customers I had, but now I’ll get busy to win them back. This will be great for our many New York customers who visit Virginia wine country.”

Steve Simpson, an Institute attorney, said, “New York’s ban on direct shipping from out of state was protectionism, pure and simple. The State and the wholesalers couldn’t justify it as a temperance or a tax measure, and the Court understood that. This is great news for free trade.”

Bolick stated, “This is not the end of the road. We expect an appeal. We fully expect this important decision for consumer freedom will ultimately be decided by the U.S. Supreme Court.”

Today’s decision is the latest in a string of four decisions that overturn bans on direct shipping. The latest was a decision by the 11th Circuit this November.

A hearing deciding what remedy the court will order will take place on December 5, 2002.

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