TENNESSEE JUDGE RULES IN FAVOR OF THREE-TIER

Following in the footsteps of similar hearings in Maine and Kentucky, a Tennessee judge has reaffirmed state authority to regulate alcohol.

Good news for proponents of the three-tier. After facing ongoing litigation, a Tennessee judge ruled in favor of the Wine and Spirits Wholesalers of Tennessee after a lawsuit (Jelovsek vs. Bresden) claimed the state was discriminating against out-of-state wineries by not shipping directly to consumers.

The plaintiff (Rick Jelovsek) argued that consumers faced a greater burden in traveling to another state to purchase wine at a winery than they faced buying wine on-premise at Tennessee wineries, which are also barred from shipping directly to consumers. However, the judge found his arguments “unpersuasive” and claimed the plaintiff was “ignoring geography and mixing apples and oranges.”

In response to the plaintiff’s allegations, the WSWT argued that "states do not have a general obligation under the dormant Commerce Clause to ensure that all potential market participants, no matter how geographically remote, have the same economic opportunities as in-state producers."

The Judge stated that “there is a significant difference . . . between permitting direct shipment of wine into or within the State and permitting wineries to sell a limited quantity of their wine on-site."

Therefore, Tennessee will remain a three-tier state unless the case is eventually appealed. Says Craig Wolf, president and CEO of the Wine and Spirit Wholesalers of America:

“The court today recognized Tennessee’s requirement of selling alcohol face-to-face as appropriate and legitimate. This decision is the latest in a string of rulings that have correctly interpreted Granholm as having a very narrow focus and application.”