The Healthcare Decision and Wine Shipping: The Impact

ScotusWhenever high courts take on the issue of the U.S. Constitution's Commerce Clause, wine industry free traders need to pay attention. It is the Commerce Clause's intent of giving the Federal Government the power to regulate inter-state commerce and the implied prohibiton against states regulating inter-state commerce, that forms the legal basis for overturning state laws that seek to protect its in-state companies from having to compete with direct shippers of wine.

So it was that many in the wine industry were carefully watching the outcome of the Supreme Court case concerning the Affordable Care Act. That case turned on the Court's view of the Commerce Clause.

Despite the conservative majority's explanation in the ACA opinion that the Commerce Clause's grant of power to federal government to regulate interstate commerce did not include compelling Americans to take an economic action they otherwise would choose not to take, the ruling had no effect on wine shipping jurisprudence.

The 2005 Granholm v. Heald Supreme Court decision dealt with the intersecting grants of power of the Commerce Clause and the 21st Amendment. While the Commerce Clause gives the Federal Government the power to regulate inter-state commerce, the 21st Amendment gave the states the power to regulate the sale and distribution of alcohol within their borders. The question in that case boiled down to what extent the grant of alcohol regulatory power given to the states by the 21st Amendment allowed states to intrude on the federal power to regulate commerce between the states?

The Supreme Court declared:

"States may not enact laws that burden out-of-state producers or shippers simply to give a competitive advantage to in-state businesses…. Laws of the type at issue in the instant cases contradict these principles. They deprive citizens of their right to have access to the markets of other States on equal terms."

Despite the Supreme Court's recent wrong-headed interpretation of the power of the Federal Government to regulate the healthcare market by mandating the purchase of health insurance and the implications this poor ruling has on the future of government regulation of the U.S economy, this decision had no impact on the Court's earlier 2005 ruling that states may not discriminate against interstate commerce in wine.

There is always the possibility that a new wine-related case may one day make it to the Supreme Court that would ask the court to clarify some yet unanswered questions about the the full meaning of its 2005 wine shipping decision. But until that happens, wine shippers can observed the recent ACA court ruling and breath a sigh of relief.

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