Industry Reacts to 5th Circuit Ruling

FILED JANUARY 1, 2010

Dear Client:

You’ll recall that the 5th Circuit Court released a very important decision yesterday that said the state of Texas is not in violation of the Commerce Clause by allowing in-state retailers to ship direct to consumers, but banning out-of-state retailers from doing the same. You can view our coverage of the ruling here. Here’s what some of the industry trade groups had to say:

SPECIALTY WINE RETAILERS ASSOCIATION: “We are very disappointed that this panel of the 5th Circuit Court of Appeals chose to limit Texas consumers' ability to access the wines they want, but which they cannot find in the state's wholesaler-controlled marketplace. We are carefully reviewing the decision and considering our next steps.”

WINE & SPIRITS WHOLESALERS OF AMERICA: “This unanimous opinion from one of the most respected circuits in the country clearly and forcefully reinforces WSWA’s view that the landmark 2005 Supreme Court decision in Granholm v. Heald preserved a state’s right to control the distribution of alcohol. This decision is a very strong affirmation of state authority under the 21st Amendment to regulate the distribution of beverage alcohol...The Fifth Circuit’s affirmation of the three-tier system and its recognition that Granholm is limited to products and producers mirrors earlier rulings by the Second and Fourth Circuits....”

NATIONAL BEER WHOLESALERS ASSOCIATION: "NBWA is pleased to see that the Court recognizes the broad authority of the 21st Amendment and acknowledges that alcohol is different than other products. It is unfortunate, however, that there are numerous other cases in the courts where plaintiffs are trying to break down state alcohol laws including those designed to keep alcohol out of the hands of minors and those that work to ensure choice and variety for America's consumers.”

WSD BRIEFS:

KANSAS PROPOSES TAX INCREASE. A House tax committee is considering legislation that would double taxes on alcoholic beverages. The current tax rate on beer is 18 cents a gallon, 30 cents for wine and $2.50 on spirits.

CONSUMER CONFIDENCE rose for the third consecutive month in January. The index rose from 53.6 to 55.9. Sentiment about present conditions and the labor market improved. More people expected job losses to abate (but they didn't expect new jobs to be created).


Until tomorrow, Megan

“I am a kind of paranoiac in reverse. I suspect people of plotting to make me happy.”
J. D. Salinger

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