Wine Wholesaler Cynicsim Defeated in Massachussetts

Yesterday a Federal Court judge in Massachusetts ruled that wine wholesaler-inspired, anti-consumer, discriminatory laws that seek to protect a very tiny cabal of powerful and well monied wine wholesalers is unconstitutional. How do you like that? I do!

The decision in the case of Family Winemakers of California v. Jenkins determined that a MA direct shipping law that was designed to appear even handed but was meant to exclude most out-of-state wineries from shipping into the state did not meet the requirement that wine shipping laws provide a level playing ground for in-state and out-of-state shippers.

That's all fine. But what's really nice about this decision is that it strikes directly into the heart of a cynical strategy that wine wholesalers have adopted across the country whereby they pressure willing lawmakers into passing legislation that appears to be even handed but in fact is designed specifically to lesson consumer access to wine and protect their own self interests.

In MA that self interest was protected by placing a limit on which in-state and out-of-state wineries could ship to residents. If you made less than 30,000 gallons of wine annually, then you could ship wine. If you made more than 30,000 gallons then you could ship only if you hadn't engaged a wholesaler during the past 6 months. How convenient that all MA wineries made less than 30,000 gallons of wine.

Family Winemakers of California and Tracy Genesen and Ken Starr of Kirkland & Ellis deserve a ton of credit for pushing this case forward. It was the first case to truly demolish the cynicism and lavish anti-consumer attitude adopted by America's wine wholesalers since the 2005 Granholm v. Heald Supreme Court decision.

The impact of this decision could be widespread. For example, there are states such as Illinois that put into place a capacity cap for self distribution of wine from wineries to retailers. Are those unconstitutional too? The MA case hinged on the specific comments made by legislators that the 30,000 capacity cap would help protect MA wineries. How that aspect of the case impacts the overall principles of the ruling isn't yet known. But it's important.

More info:

Family Winemakers of California Press Release
Free The Grapes Press Release
The Bostonist Story
ShipCompliant Blog's Story
The Judge's Ruling

Comments

[Thomas Pellechia]

Tom,

Did the court rule that it was federally unconstitutional or that it violated the Massachusetts Constitution?

[Tom Wark]

U.S. Constitution. As usual, it hinged on a dormant commerce clause analysis.

[Thomas Pellechia]

That's good news.

Still, it shows that we need a clear message on the Commerce Clause from the US Supreme Court. That would end all the jockeying of wholesalers and state legislators.

[Steve]

This is great news for those of us currently suffering in Illinois!

[Dylan]

I'm glad to see this kind of progress. Ken Starr, Tracy Genesen, and the Family Winemakers of California--if you happen to read this comment wall, your efforts and advancements are appreciated. Great job!

[Michael Costa]

What impact, if any, is the ruling likely to have on retailer shipments into MA?