Judge: Wine shipping law unconstitutional

Michael W. Hoskins
January 1, 2007
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Indiana's law prohibiting out-of-state wineries from shipping to Hoosier customers without face-to-face contact is unconstitutional, a federal judge in Indianapolis has ruled.

U.S. District Judge John D. Tinder issued a 71-page decision, and a separate four-page judgment and injunction late Wednesday in Patrick L. Baude et al. v. David L. Heath and Wine and Sprits Wholesalers of Indiana, No. 1:05-cv-0735-JDT-TAB.

At issue in this case was whether state statute involving direct wine shipment violated the out-of-state wineries rights by barring them from newly created direct wine seller permits. The law went into effect in March 2006, and this federal suit came the following month.

Plaintiffs include a major Michigan winery, Chateau Grand Traverse, and five consumers. They challenged the law, part of which mandated they have at least one face-to-face transaction to allow the winery to verify the customer's age. The winery contended the rules discriminated against out-of-state wineries by preventing them from competing in the direct-sale market, and the consumers argued they were barred from obtaining many wines because of the impracticality of traveling outside the state or to complete the in-person requirement.

Defendant Heath, commissioner of the Indiana Alcohol and Tobacco Commission, contended the laws do not discriminate and are needed to prevent the sale of alcohol to minors - the state's interest in protecting its youth outweighs any incidental burdens on interstate commerce.

Judge Tinder disagreed, noting that the requirement creates a trade barrier for wineries by requiring them to set up shop in Indiana or limit their potential market to buyers willing to travel to them.

This is not the first time wine connoisseurs have challenged Indiana's authority to regulate direct shipments of wine into the state. The 7th Circuit Court of Appeals in Chicago dealt a blow to wine lovers in 2000 with a ruling that the state could prohibit direct shipments, but since that case of Bridenbaugh v. Freeman-Wilson, 227 F.3d 848, 854 (7th Cir. 2000), the U.S. Supreme Court has weighed in to change the legal landscape.

In 2005, the court ruled in the Michigan case of Granholm v. Heald, 544 W.S. 460, 493 (2005) that states could not discriminate against out-of-state-wineries by prohibiting them from shipping directly to consumers if the state laws allowed in-state wineries to do so. The court ruled the repealed 21st Amendment on Prohibition did not override the requirements of the Commerce Clause in regulating interstate commerce of goods.

Relying on that high court ruling, Judge Tinder based his determination and granted the injunction enjoining the Alcohol and Tobacco Commission from enforcing the rule.

"This court's decision is likely to be of immediate interest only to those out-of-state wineries with an existing base of Indiana customers or wine connoisseurs who may have the means to persuade out-of-state firms to undertake the effort," he wrote. "Indiana wineries will not need to change any of their current business practices. Indeed, there is little likelihood that much will change before the General Assembly meets again."

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  1. Joe, you might want to do some reading on the fate of Hoosier whistleblowers before you get your expectations raised up.

  2. I had a hospital and dcs caseworker falsify reports that my child was born with drugs in her system. I filed a complaint with the Indiana department of health....and they found that the hospital falsified drug screens in their investigation. Then I filed a complaint with human health services in Washington DC...dcs drug Testing is unregulated and is indicating false positives...they are currently being investigated by human health services. Then I located an attorney and signed contracts one month ago to sue dcs and Anderson community hospital. Once the suit is filed I am taking out a loan against the suit and paying a law firm to file a writ of mandamus challenging the courts jurisdiction to invoke chins case against me. I also forwarded evidence to a u.s. senator who contacted hhs to push an investigation faster. Once the lawsuit is filed local news stations will be running coverage on the situation. Easy day....people will be losing their jobs soon...and judge pancol...who has attempted to cover up what has happened will also be in trouble. The drug testing is a kids for cash and federal funding situation.

  3. (A)ll (C)riminals (L)ove (U)s is up to their old, "If it's honorable and pro-American, we're against it," nonsense. I'm not a big Pence fan but at least he's showing his patriotism which is something the left won't do.

  4. While if true this auto dealer should be held liable, where was the BMV in all of this? How is it that the dealer was able to get "clean" titles to these vehicles in order to sell them to unsuspecting consumers?

  5. He has refused his Assent to Laws, the most wholesome and necessary for the public good. He has forbidden his Governors to pass Laws of immediate and pressing importance, He has erected a multitude of New Offices, and sent hither swarms of Officers to harrass our people, and eat out their substance. He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation: For imposing Taxes on us without our Consent: He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation and tyranny, already begun with circumstances of Cruelty & perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.. He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless [ ] Savages, whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions. GOD BLESS THE GOVERNORS RESISTING! Count on the gutless judiciary to tie our children down and facilitate the swords being drawn across their throats. Wake Up America ...