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Court Strikes Down Ban on Wine Shipments
By HOPE YEN, Associated Press Writer 1 minute ago

Wine lovers may buy directly from out-of-state vineyards, the Supreme Court ruled Monday, striking down laws banning a practice that has flourished because of the Internet and growing popularity of winery tours.

The 5-4 decision strikes down laws in New York and Michigan that make it a crime to buy wine directly from vineyards in another state. In all, 24 states have laws that bar interstate shipments.

The state bans are discriminatory and anti-competitive, the court said.

"States have broad power to regulate liquor," Justice Anthony Kennedy wrote for the majority. "This power, however, does not allow states to ban, or severely limit, the direct shipment of out-of-state wine while simultaneously authorizing direct shipment by in-state producers."

"If a state chooses to allow direct shipments of wine, it must do so on evenhanded terms," he wrote.

Kennedy was joined in his opinion by Justices Antonin Scalia, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer.

At issue was the 21st Amendment, which ended Prohibition in 1933 and granted states authority to regulate alcohol sales. Nearly half the states subsequently passed laws requiring outside wineries to sell their products through licensed wholesalers within the state.

But the Constitution also prohibits states from passing laws that discriminate against out-of-state businesses. That led to a challenge to laws in Michigan and New York, which allow direct shipments for in-state wineries but not out-of-state ones.

In a dissent, Justice Clarence Thomas argued that the ruling needlessly overturns long-established regulations aimed partly at protecting minors. State regulators under the 21st Amendment have clear authority to regulate alcohol as the see fit, he wrote.

"The court does this nation no service by ignoring the textual commands of the Constitution and acts of Congress," Thomas wrote.

He was joined in his opinion by Chief Justice William H. Rehnquist, as well as Justices Sandra Day O'Connor and John Paul Stevens.

Posted by Michael at May 16, 2005 10:34 AM