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Apr 24, 2014

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Texas judge rules in favor of mail order alcohol sales

Lobbyists seeking national ban step up efforts

Feb 14, 2000 - Consumers fighting for the right to receive alcohol shipped from out-of-state producers won another victory last week in Texas. All those who buy beer and wine through the mail or over the Internet are possibly affected by the ruling.

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Meanwhile, those lobbying for a national law restricting sales have stepped up public lobbying to get that law passed.

U.S. Federal Judge Melinda Harmon ruled that Texas couldn't prohibit consumers from buying and receiving wine from out-of-state wineries. She ruled in favor of consumers Randy Pennington, C.A. Dickerson and David Vukovic, who challenged the Texas anti-direct shipping statute that prevented them from purchasing and receiving wine direct from small California and Arkansas wineries.

Judge Harmon wrote that small wineries, who comprise over 90% of the total market in number but less that 10% of the total production volume, cannot realistically meet the statute's burdens of obtaining permits and distributors for the limited quantity of product that they have available to sell.

Mark Harwell, one of the plaintiffs' lawyers, said: "Judge Harmon has written by far the most scholarly and in-depth opinion by the federal courts on this issue and it should make quite a difference in the ongoing legal fight against protectionism directed at small out-of state wineries."

Consumers in Indiana recently won a similar court victory. A total of five lawsuits of this nature have been filed within the past eighteen months. In addition to consumer successes in Texas and Indiana, three cases are pending in Virginia, New York and Florida.

Those opposed to shipments have not been silent. A press release from the Wine & Spirits Wholesalers of America on Monday claimed that a guilty plea by Beer Across America to misdemeanor charges of illegally importing alcohol into Utah and selling beer to a minor "unmasks the dangerous reality of the billion-dollar illegal direct shipping industry -- underage teenagers can use these illegal services to buy beer, liquor and wine."

The Wine & Spirits Wholesalers, who face competition from those selling alcohol via mail order and the Internet, are among those lobbying for passage of the "21st Amendment Enforcement Act" by Congress. Known officially as S. 577, the measure has passed the house and Orrin Hatch, chairman of the Senate Judiciary Committee, announced that he will push for passage of S. 577 as a stand alone bill in the Senate in coming months.

In Utah, Beer Across America was ordered to pay a $5,000 fine to 3rd District Court in Salt Lake City and another $20,000 to the Utah Department of Public Safety for programs to enforce the state's stringent alcohol laws. Company President Louis Amoroso also must pay $1,000 for two separate class B misdemeanors for unlawful sale and importation of alcohol and has agreed to subject himself to the jurisdiction of Utah courts if he ever sells alcohol in Utah again.

Many of Beer Across American's beers have a stronger alcohol content than 3.2 percent -- the limit for beer sold outside of state liquor stores -- and are not available under Utah's state-run liquor monopoly.

The state charged the company and its president with unlawful importation, sale and distribution of alcoholic beverages, all class B misdemeanors. The company also was charged with sale to a minor, a class A misdemeanor, when a 19-year-old placed an order and received beer with his parents' permission using their credit card.

Third District Judge Robert K. Hilder dismissed the charges in 1997, citing jurisdictional problems and restrictions by the commerce clause of the U.S. Constitution, which gives Congress the power to regulate interstate sales.

The Utah Court of Appeals reinstated the counts last year.


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