Fermentation: The Daily Wine Blog

Why the Supreme Court Was Asked To Hear Retailer Wine Shipping Case

QUESTION:

Notwithstanding Granholm v. Heald, does the Twenty-first Amendment to the U.S. Constitution overrides its Commerce Clause and allows States to discriminate against out-of-state businesses in the sale of alcoholic beverages?

This is the question that the Specialty Wine Retailers Association (for which I serve as Executive Director) is asking the Supreme Court of the United States to decide. A Writ of Certiorari ( filed last week and downloadable here) asks the court to review a decision by the Fifth Circuit Court of Appeals that overturned a Texas Federal Court's decision that prohibiting out-of-state wine stores from shipping to Texans while allowing Texas-based stores to ship to Texans violated the Commerce Clause of the Constitution.

WHY IS THIS CASE IMPORTANT?
Today only 13 states allow out-of-state wine stores to ship wine to their residents, while 38 states allow out-of-state wineries to ship wine to their residents. This is the case despite the fact that there is no difference between the transaction or logistics involved in a winery selling to consumers and shipping wine to consumers on the one hand and a wine store selling wine to consumers and shipping wine to consumers on the other hand. More importantly, the arbitrary state bans on wine stores-to-consumer shipping means that consumers have far less access to wines than they could other wise. It means that many wine shops don't have access to the commercial revolution that other industries have experienced due to the Internet and highly efficient shipping methods.

From a Constitutional perspective, it means that if the Supreme Court does not overturn the decision of the Fifth Circuit Court of Appeals allowing Texas to discriminate against out-of-state wine stores, wine shops across the country will effectively have their rights under the Commerce Clause to be free of discrimination in interstate commerce stripped from them. This will be only the second time in the history of our country when a particular sector of the economy has seen this critical protection stripped from them.

Finally, from a consumer perspective, for too long consumers have seen their basic interests ignored for the sake of protecting the parochial, financial interests of a small band of extraodinarily powerful, well-connected and subsidized industry players. Simple and absurd arguments have been floated and embraced to protect the laws that protect these industry players. The archaic system of wine distribution that was designed to accommodate a 1930s world now exists to protect special interests that have erected cynical and self serving platitudes that take no account of history, free trade or any interests beyond their own. These special interests make outlandish and false claims against anyone who even suggests this archaic system governing the American wine industry be reformed. Laws and lawmakers are bought and sold by special interests to assure no measure of fairness invade the special regulatory cocoon that protects certain industry players. This lawsuit takes a tiny step in balancing what has become a truly unbalanced system that no longer even attempts to serve the needs of of American wine consumers.

THE ARGUMENT
The State of Texas, the Fifth Circuit Court of Appeals and wine wholesalers argue that when the Supreme Court wrote that the "three tier system is unquestionably legitimate" the High Court meant that any manifestation of the three tier system in any state was protected from having to comply with the Commerce Clause of the U.S. Constitution, which gives the federal government, not the states, the power to regulate interstate commerce among the various states. Only if there is an exception in the law to a state's general regulatory organization of the distribution of alcohol, such as letting wineries sell their wine at retail, is the state then required to comply with the Commerce Clause. Hence, when states allow their own wineries to sell direct to consumers and ship direct to consumers (something not historically allowed under three tier systems of alcohol distribution) they must comply with the commerce clause, meaning they may not get in the way of allowing out-of-state wineries to ship to their consumers. The 2005 Granholm v. Heald Supreme Court ruling made this clear.

However, the Supreme Court in that 2005 ruling never said that wine retailers were exempt from the protections against discrimination provided by the Commerce Clause of the Constitution. In fact, no Supreme Court ruling and no congressional law has ever suggested such a thing. In order for the federal government to give up its right to regulate interstate commerce in any industry and give that power to the state, the Congress must say so directly. That has never happened. In essence, the Fifth Circuit Court of Appeals has elevated the three tier system to quasi-Constitutional stats that outranks the Commerce Clause.

What's interesting is that in two cases concerning this issue that appeared in Federal appeals courts, justices have bemoaned the fact that they need Supreme Court to give guidance on this issue. The hope of specialty wine retailers and consumers across the country is that the Court will give that guidance.

The arguments the wholesalers give for the notion that retailers somehow have no protections under the Commerce Clause are weak. For example, At Alcohol Law Review, a website administered by wholesalers, the following was recently suggested:

"Once again they (specialty retailers) try to blur the lines and claim that retailers and wineries are the same entity.  They forgot to mention that the federal government doesn’t agree with that.  For example, the wineries need to be licensed at the federal level. Retailers do not."

At best, this is a non-sequitur. Neither Congress nor the Supreme Court has ever suggested that for a business to be granted protection from discrimination under the Commerce Clause it must receive a license from the federal government.

One of the reasons this issue of wine store-to-consumer shipping is so important is that it goes to the issue of the blatant protectionism that exists in the wine industry. I've yet to hear a reasonable argument as to why a winery ought to be able to ship into a state, but a wine store should not be allowed. When a reason is given, it often revolves around the notion that in-state wine stores are put at a disadvantage because out of state stores don't have the same taxes and fees to pay as in-state stores. But of course this argument is ludicrous. Taxes could be paid to the shipping state. Plus, the cost to ship the wine far outweighs any in-state fees a local store may have.

No, the reason that this kind of discrimination continues to occur is because it can and because neither lawmakers nor the wholesalers that control state legislatures have any desire to protect the interest of consumers in their states.

It will be a few months before the Supreme Court makes a decision as to whether or not to take up this case. In the mean time, the state of Texas and Texas wholesalers and many others will send briefs to the Supreme Court weighing in on whether or not the high court should take up this issue.

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The State of My Ego and Six Years of Wine Blogging

On the sixth anniversary of starting this blog, I see that I've produced 2,170 posts in those six years of blogging about wine, the wine industry, wine politics, wine public relations and marketing, and my affinity for bourbon.

However, all those blog posts aren't what interest me today as I reflect on the past six years of writing under my own name for public consumption. What interests me is why I, and other wine bloggers, do it. Though difficult to tether all wine bloggers to the same explanation, it is significant that we all have something in common:

1. Our blogging is meant to attract (or at least results in attracting) attention to ourselves.

2. We are, for the most part, uncompensated for our blogging

3. We believe the opinions and thoughts laid out in our blogs are worthy of attention and consideration.

Is it all merely an exercise in ego stroking?

No...not entirely, though anyone who denies that writing for public consumption is an act of ego stroking, particularly when it is unpaid writing and meant to be read by strangers and acquaintances alike, simply must engage in a bit more honest self reflection.

For me, in November 2004, the key point was #3. I honestly believed that after having spent 15 years writing on behalf of clients and their brands, that my own personal thoughts and opinions on the ebb and flow of wine industry matters were worthy of consideration. I admit giving in to self reverence.

Today my motivation is somewhat different. There is a great deal going on after six years of working this blog that keeps me motivated.

First, writing commentary and essays on a daily basis has become a part of my daily routine that serves the necessary act of exercising my powers of observation and reflection.

Second, blogging has actually become an act of self indulgent relaxation—a development I don't fully understand.

Third, though I write about a variety of topics, my semi-regular forays into wine politics on this blog satisfy my desire to try to draw attention to certain kinds of reform this industry badly needs.

Fourth, advertisers on this blog deserve to continue to have as vibrant a platform as possible for their marketing efforts to gain interest from this blog's readers.

Fifth, this blog represents the best tool I can currently fashion to generate and control the kind of conversations I want to have.

The 2,170 posts over the past six years comes out to 361 posts per year, beginning November 29, 2004—meaning I've failed by a sliver to live up to the idea of a "Daily Wine Blog". Going forward, I'll just have to work harder to serve my ego.

When All That's Required is Alcohol in Liquid Form

I wonder if there are other wine geeks like me who at times merely need their wine to possess alcohol and be in liquid form? And that's really all that is required. Anything more would demand making the effort of concentrating on the beverage's traits, evaluating it, comparing it and, well, sometimes that just takes too much effort.

The funny things is, for folks like us, the comparing, evaluating and identifying is second nature and comes generally in an automatic fashion; like an tennis player nonchalantly ripping a top-spin whizzer just in front of the baseline. There's no need to really think hard about the act. It's second nature after all this time.

But tonight I was content with the thin, simple insipid Bordeaux that was poured by the glass in a San Francisco restaurant. It easily washed down my poussin, didn't block the view of a favorite restaurant, and didn't get in the way of the pleasure of being with the one I love for a quiet dinner.

Yet I remember when every wine I encountered demanded my attention. Those early years of learning the varieties. That time when I was getting accustomed to the limits of my palate. That early era when understanding what was in my glass took precedent over my evirons—no matter who occupied them with me.

These moments of vinious nonchalants don't come as often as I might lead you to believe, but they do arrive more often now than in the past.

The other occasion when the content of my glass is of no matter is when I'm merely seeking the effects of alcohol. I don't know how many of us wine geeks admit it, but sometime the wine in our glass really is nothing more than an alcohol delivery vehicle. That wasn't the case tonight, but it is the case more often these days than in the past.

I'm not saying I don't geek it up. I do. In fact, I think I'm a damn good wine geek. I can both impress and annoy people with my wine geekiness when I desire. And sometimes (often times, really) there's nothing more fulfilling than sitting around with fellow wine geeks and collectively ripping forth with a cacophony of unrestrained, plagiarized, loudly proclaimed and totally-educated geeksspeak over a selection of bottlings.

But sometimes, a shitty little ditty that is liquidy and infused with alcohol is all that's required. Tonight, that shitty little ditty of a Bordeaux was the perfect accompaniment to a moment it had no business getting in the way of.

Bloggers, Credibility and Wine Writer Surveys

Take a close look at this chart. It comes from the recently released 2010 American Wine Writer Survey and outlines some differences between those that have been writing about wine for 5 years or less and those writing about wine for 20 years or more.

The first thing to take note of is the use of social media tools like blogs, Facebook and Twitter. The less time someone has been writing about wine, the more likely they are to use social media tools. Clearly writers with less experience are younger and we know that younger folks are more enthusiastic about social media. I think this is something of great importance to know.

But the one difference that is also striking is the attitudes toward bloggers. More experienced writers simply don't have nearly the confidence in the credibility of bloggers as less experienced bloggers who, as it turns out, are much more likely to maintain a blog. But that's not the point. The point is that those writing about wine the longest really are not inclined to find bloggers to be trustworthy. The big question here is, DO THEY HAVE A POINT???

The question in the survey that led to this response did not define "Trustworthy". However, lets assume that those who read the question understood that "trustworthiness" was a good thing and let's further assume that not having a lot of trust is a bad thing.

In my view, the single most important point that would lead anybody, and in particular experienced wine writers, to downplay the credibility and trustworthiness of a blogger is the well know fact that there is absolutely no gatekeeper when it comes to who can publish a blog. There is no pre-assessment of the talent and skills of a wine blogger prior to their publishing. There is no editor that evaluates their skills and gives the blogger the job of writing about wine. Bottom line: A fourteen year old girl inhabiting the attic of her mother's home on the North Dakota border with Canada and suffering from delusions can as easily start writing and publishing a wine blog as the most experienced wine writer living in the heart of Wine Country.

The question is: Is there evidence in the wine blogging world that this "hole in the fense" tends to produce wine bloggers that have the primary quality of being poor writers and ignorant in the ways of wine?

Sure there are.

But you know what, there are many such pathetic excuses for wine bloggers. The majority it seems are pretty decent at describing why they liked the wine they tasted last night and of sharing wine news with their readers accompanied by sparse and inconsequential commentary.

Put another way, there remains a bias against bloggers that has the effect of diminishing the over all perception of the talent of bloggers. However—and this is important—it means the REALLY GOOD wine bloggers and even the DARNED GOOD wine bloggers stand out like soar thumbs.

This is an entirely different situation compared with wine writers who are given columns in small market magazines and newspapers. By virtue of having the cover of a credible publisher, their talents are given much more of a benefit of the doubt...despite the fact that they may not be anywhere near as good as a DARNED GOOD wine blogger or certainly of a REALLY GOOD wine blogger.

Credibilty and trustworthiness tends to be more readily bestwoed on those who have the benefit fo "being published" by a reputable publisher. Should they have this advantage? It doesn't matter. They do.

And so, for wine bloggers, here's the take away: Do you want more immediate acceptance as a credible and trustworthy voice among more people? Get a print column in your local newspaper.

 

The 2010 American Wine Writer Survey

The demographics, work habits, publishing habits, and concerns of the American wine media have changed drastically since I first started observing the wine writing fraternity more than 20 years ago. This is all confirmed in the newly released, 2010 American Wine Writer Survey.

But among the more interesting findings of this new survey is that wine writers remain unimpressed by the work habits of people like me: publicists and marketers who attempt to gain the attention of writers for the purposes of helping promote the products and services of their employers and clients.

Fully 81% of respondents to the survey found the work of publicists and marketers only "somewhat" or "rarely" useful. That's pathetic. Furthermore, only 3% of respondents said our work is "extremely" useful.

There is a key, I think, to making the work of publicists more relevent to writers: Give them what they want and don't be a nudge!

This is PR 101, but it needs to be said: know what a writer writes about before pitching them a story and if you send them a press release, don't call them asking if they received the released.

This lack of respect for publicists by writers has been a constant theme in the Wine Writer Survey's I've conducted in 1995, 2004 and again in 2010. In addition to some of the poor habits that I and my brethren employ where media relations is concerned, I suspect that part of our reputation problem has to do with bulk information that is sent to wine writers and the velocity with which it is sent. Wine marketing probably relies on public relations and media relations as much as any industry. So wine writers are inundated with information from publicists and marketers and it can get a bit overwhelming.

Over the past three years or so, I, as a result of this blog, have also been the object of the work of publicists hoping to convince me to write about their clients or employers. I'm sure I take a more benign view of the contacts since I probably sympathize with publicists more than professional wine writers (I am a publicist—afterall)

Still, every time I've looked at the survey results, beginning in 1995, I get a little down on myself and my profession.

The 2010 American Wine Writer Survey has much more in it than just the view of wine writers that publicists and marketers can do a better job. I urge you to look it over:

2010 AMERICAN WINE WRITER SURVEY

 

A Wine Wolf in Puppet's Clothing

Well, this is hilarious...and educational. And your favorite wine blogger has a cameo. I'm not sure where the folks at VinTank find their inspiration, but they inspire me.

Watch this Video as though your life depends on it.

Unfiltered: Episode 3 from VinTank on Vimeo.

Global Zinfandel

It's GLOBAL ZINFANDEL DAY!!

Why today? Because ZAP (Zinfandel Advocates and Producers) says so. And that's good enough for me.

I like the idea of taking at least one day out of the year to celebrate a specific grape. ZAP is encouraging wine lovers to take part in home tastings with friends as well as utilizing social media to talk up and celebrate the Zinfandel grape and wine.

Today, Twitter users will be utilizing the #Zinfandel hashmark in abundance. And they'll be highlighting Zin on their Facebook pages!

Much more information can be found at the ZAP Website and at the Event Webpage for GLOBAL Zinfandel Day.

The Terroirist Has Arrived

It has been some time since I've highlighted a new wine blog that deserves our attention. I'm not sure what that means and I prefer not to contemplate the matter.

That said, go read TERROIRIST: A Daily Wine Blog.

It's new, it's good, it's smart, it's daily and it's on my "to read" list.

TERROIRIST is the creation of David White, a Washington, DC based writer and communications consultant who has an eye for the curious, the cultural, the political and the sweet delights of wine. Just as important, White can write! In fact, if you want an extended example of White's writing talents I highly recommend a story he wrote for the recent issue of The World of Fine Wine: "States of the Nation", an outstanding piece on the state of wine regulations and laws in the United States. It is superb.

The challenge that White has laid down for himself is of benefit to his readers, but truly a challenge that many a wine blogger has failed at:

"Some wine blogs offer value recommendations. Others seek out hidden gems or catalogue tasting notes of impossible-to-acquire bottles. Some cover politics, others examine different viticultural and vinicultural techniques. Many cover the wine industry. Just about all sit dormant for weeks at a time. Terroirist.com was launched on November 9, 2010 to change all that – by covering everything, daily."

Daily blogging is hard. I can tell you that from experience. But, being a writer by profession, I have confidence that White will make a go of it. He'll be aided in this effort with the help of a crew of "Terroirists" who also write on the blog including Ainsley Adams—a graduate student and wine geek in Baltimore, Greg Golec—a project manager from Chicago, Kristin Redding—working at a creative consulting firm in Chicago, Andrew Feldson—A New York City-based wine geek, and Robbie Scrum—a colleague of David's at Keystone Communications in DC.

The content is spectacularly diverse and compelling at TERROIRIST. You'll find everything from a defense of Robert Parker and commentary on the FourLoko controversy to reviews of winery visits and round-ups of the news. Posts at TERROIRIST are not overly long. They are festooned with photos and they are generously linked. Again, all very, very good.

It makes me very happy when I can write posts about new and compelling wine blogs. Today I'm happy.

 

Jefferson (and Wine) Lives!!

Jim Gabler will be familiar to readers of this blog who count themselves devotees of the more esoteric wine literary pursuits. An expert on wine and the life of Thomas Jefferson, Gabler has penned two of the more fascinating books in the American wine literary canon: "An Evening with Benjamin Franklin and Thomas Jefferson" and "Passions: The Wines and Travels of Thomas Jefferson," winner of the Veuve Cliquot Wine Book of the year. He has also penned, "Wine Into Words," the most comprehensive bibliography of english language wine books.

Jim has a new blog. And it qualifies as much as any wine blog for the characterization of "niche".

The new blog is entitled, Thomas Jefferson, Wine and Conversation.

To quote the new wine blogger:

"Each week (usually on Monday) you will find on the home page a different Jefferson venue: the White House, Monticello, Jefferson's Paris residence, Mount Vernon, etc. where you will be Mr. Jefferson's guest at dinner. He will evaluate that week's wine selection and share with you some of the most interesting experiences of his life. You will meet his friends, Benjamin Franklin, James and Dolly Madison, George Washington, John and Abigail Adams, Marquis de Lafayette, Philip Mazzei, Maria Cosway, Meriwether Lewis, Alexander Hamilton, Aaron Burr, and many others."

It's always been hard to interest some people in history, even if that history includes wine anecdotes. When I was lecturing to college freshmen on American history there was always a dull look in at least half the students' eyes. I wasn't a bad lecturer, so I don't think that was it. I think the problem was the level of interest in things like the Articles of Confederation, the rum trade in colonial America and the ratification debates.

Still, if anyone can interest wine lovers in history (and wine lovers should have an interest in history if only to understand why they are tasting what they are tasting) it's Jim Gabler

His last book, "An Evening With Benjamin Franklin and Thomas Jefferson," as a fascinating and fun piece of historical conjecture that put Ben and Thomas in a room talking about their lives and their wines...something only James Gabler could write. Following its publication in 2006 I had a chance to interview him for this blog. It's a good read.

The new blog obviously combines his love of wine and history. Imagine a "Wine of the Week" introduced by Thomas Jefferson and perhaps commented upon by Ben Franklin or Aaron Burr. Wouldn't it be great to walk into a wine shop and read a little shelf talker description of a wine that had "Thomas Jefferson" identified as the source of the quote or rating.

With Thomas Jefferson, Wine and Conversation you are bound to get great writing, an introduction to a good wine and a bit of revolutionary era conversation that no other wine blog can deliver.

 

The Association of Stupid People May Make Irish Coffee Disappear

One of the most striking controversies in the world of alcohol today is whether or not Caffeinated Alcohol drinks are safe to consume. In October, 23 students at Central Washington University were hospitalized after drinking Four Loco, one such caffeinated alcohol drink. In Maryland, a woman crashed a truck and died after consuming Four Loko. Numerous colleges have now banned the consumption of Caffeinated alcohol drinks, the states of Michigan and Washington have banned such drinks and other states are considering similar bans.

Are these drinks "safe"?

First, let's look at the most notorious of them: Four Loko, produced by Phusion Projects. The can contains 23.5 ounces of liquid, just slightly less than a 750 milliliter bottle of wine. The alcohol content is 12%, much less than the average alcohol content for wine, which is quite often over 14%.

The caffeine content of Four Loko is just slightly less than what you'd get in a standard 12 ounce cup of drip coffee.

The drink also contains taurine and gaurana, two ingredients found in most energy drinks.

A 2008 review of medical and research literature concerning the effects of taurine and gaurana in energy drinks found "The amounts of guarana, taurine...found in popular energy drinks are far below the amounts expected to deliver either therapeutic benefits or adverse events."

It turns out that the FDA is doing a study of these caffeinated energy drinks and has been since 2009. With the 23 students going to the hospital in Washington State after drinking Four Loko and with states and campuses now banning the stuff, I'm guessing the FDA's study just got more pressing. Here is what I know they won't find and won't do.

I can nearly guarantee that the FDA will not find enough of a problem with the mixing of Caffeine and Alcohol to call for any sort of a ban on the mixing of these ingredients. We've been mixing alcohol and Caffeine for hundreds of years. My guess is that it has been happening in the West since the 15th century. And what is the FDA going to do, demand that no bars in America ever serve Irish Coffee ever again? I don't think so.

The problem with these drinks is social, in their packaging design and in their taste. Allow me to explain.

First, the drink is not particularly intoxicating. In fact, it's not as intoxicating as wine if you drink the same amounts. However, it is very easy to drink. The sugar and artificial ingredients make this stuff go down real easy. It's packaging, in a can that looks like any energy drink, gives us the impression it is similar to an energy drink, or even a beer, which isn't so intoxicating. But, combine these two things with inexperienced college student who isn't used to alcohol and who is given a reprieve from bite of alcohol by the sweetness of the drink and the ease with which it goes down, and you've got a problem.

Now, it is also reported that the caffeine in these drinks "mask" the effect of the alcohol. Again, the inexperienced college kid doesn't have the storehouse of drinking knowledge to know that this much alcohol is going to mess you up. But when the effect is further masked, for a time, by the caffeine, and they feel they can drink even more.

But here's the thing, the FDA can't regulate stupidity and inexperience. And they aren't going to ban the mixing of alcohol and caffeine because, well, because that's just stupid. Plus, those of us who revere the Buena Vista Cafe's Irish Coffee would march on Washington.

So here is what I think will happen with these drinks. Until the FDA can thoroughly study the effects of combining Alcohol, caffeine AND TAURINE AND GAURANA, they will ban the sale of such mixtures. And what I'm willing to bet is that after they take 5 to 10 years to study this, they will conclude they have found no health concerns with the mixtures. You can probably count on a lawsuit or two in their also.

There is going to be a lot of hypocrisy and politicking around this issue. Politicians will call for its banning, as will anti-alcohol groups. And we'll see a number of state actually ban the sale of energy drinks in the interests of the kids.

What really needs to be banned, however, is stupidity. We need to ban young people from being stupid—like drinking 75 ounces of 12% alcohol in an hour. Of course of ban on being stupid would lead to an equal protection lawsuit by the ASP: "The Association of Stupid People", and frankly they'd be correct to file it.

The only serious message that comes out of this post is that we ought to play close attention and hope that no one with intellectual consistency takes up this issue and asks to ban Four Loko and other Caffeinated Alcohol drinks. An intellectually consistent girl or boy would then have to call for the banning of any and all mixing of caffeine and alcohol. And not to beat a dead horse, but I want my Irish Coffee and I don't want to have to break the law to get it.