Wine Distributors Forced to Eat Their Own Excrement
Monarch Beverage Company, one of Indiana’s largest wine and beer distributors, lost its appeal in the 7th Circuit Court of Appeals. That court said the state could bar beer and wine distributors from also distributing spirits.
Monarch thought it unfair and unconstitutional that the state barred it from selling something in the way it thought it should be able to sell it. The irony.
I wonder what Indiana’s wineries are thinking upon hearing about this decision, particularly when they think back 10 years when Monarch and other Indiana distributors lobbied that state’s legislature to revoke wineries’ rights to self-distribute to retailers and restaurants. Which they did!
The court sided with the state that keeping beer and wine distributors from also distributing liquor promoted temperance by artificially keeping consumer prices higher:
“it’s hardly irrational to think that separating beer and liquor wholesaling is likely to impose higher distribution costs than if beer and liquor wholesaling were combined. That, in turn, keeps liquor prices higher, with the salutary corresponding effect of reducing consumption.”
Monarch learned the hard way that if you make stupid, anti-competitive arguments that depend are weird rationales just to line your own pockets for long enough, eventually, the courts and the state are going to believe you.
I shed tears for the absurd rationales that keep in place ridiculous laws like those that keep beer and wine wholesalers from also distributing liquor, laws that keep producers from selling directly to retailers and laws that keep consumers from buying directly from out-of-state retailers and wineries.
But I don’t shed a single tear for Monarch Beverage Company. They got what they deserve.