The Supreme Court Said States Can’t Discriminate in Alcohol Sales. They’re Doing It Anyway.

Two decades after Granholm v. Heald was supposed to end protectionist shipping laws, states and lower courts continue to undermine the decision.

This month marks the 20th anniversary of the seminal Granholm v. Heald case, in which the United States Supreme Court struck down protectionist alcohol shipping laws that discriminated against out-of-state wineries. Seen at the time as a harbinger of a truly national e-commerce marketplace for alcoholic beverages, Granholm continues to be treated more like a legal inconvenience than a binding precedent by lower courts.

In Granholm, numerous wineries challenged a Michigan law that allowed in-state wineries to ship directly to state residents but required out-of-state wineries to sell their products through wholesalers. Because the case was a consolidation of several legal challenges, it also involved a New York law that only permitted out-of-state wineries to engage in direct-to-consumer shipping if they had a "branch factory, office or storeroom within the state of New York."

In a 5–4 decision, the Supreme Court struck down both laws as a violation of the so-called "dormant Commerce Clause," which establishes the principle that state governments cannot blatantly favor in-state economic interests by discriminating against out-of-state economic actors.

Continue reading the entire piece here at Reason

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C. Jarrett Dieterle is a nonresident senior fellow at the R Street Institute and a legal policy fellow for the Manhattan Institute.

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