7th Circuit Rejects Preemption and Commerce Clause Challenge to Indiana Retail Shipping Laws

In a long and interesting opinion the 7th Circuit ruled against the plaintiffs claiming retail shipping must be treated equally with winery shipping.  Click here for the opinion.   The opinion I am sure will give arguments for both sides of the debate about alcohol regulation but on balance has some nice quotations that bolster those in favor of a robust 21st Amendment.   For example,  in his opinion for the court, Judge Posner notes, that federal Supremecy Clause jurisprudence does not apply where a state like Indiana here is regulating within its core 21st Amendment powers.    Moreover, Posner then rejected the Dormant Commerce Clause challenge to Indiana’s law, with some fairly pro-Twenty-first Amendment language.  The Court explained that the Amendment would be a “dead letter” if the Dormant Commerce Clause forbid states from passing laws that possibly increased the costs of alcohol produced out-of-state.

Judge Hamilton has a long concurrence where he notes his disagreement with the 10th Circuit’s preemption analysis in USAirways and also notes that the forum for changing alcohol laws is the state legislature, not federal courts.  I’ve been saying that for years!

Both opinions note the problems with applying the Pike v. Bruce Church balancing test to state alcohol laws but that is another subject for another day.

(earlier post)   7th Circuit Sets Oral Arguments for September 12, 2011 in Indiana Retail Shipping Case

How nice of the 7th Circuit to schedule oral argument while I’ll already be in town for the Center for Alcohol Policy Legal Symposium.  Come to the CLE and perhaps we can organize a class trip over to the oral arguments.    The 7th Circuit set out notice for the oral argument in  Lebamoff Enterprises, Inc., et al v. Mark Massa for Tuesday, September 13, 2011, at 9:30 a.m. in the Main Courtroom, Room 2721. Each side limited to 20 minutes.

The  7th Circuit has been the busiest on alcohol law matters with the Baude case (face to face identification), the ABInBev lawsuit (Remedy/discrimination), and Thomas Family Winery matter (Dormant commerce clause) besides the pending Lebamoff matter.

(Previous Post)  Plaintiffs Seek 7th Circuit Review in Capt’n Cork Case in Indiana


The plaintiffs in Captain Cork are appealling the district court’s decisions.     They have shifted strategy in their appeal and seek to emphasize preemption as their route to victory.  They have filed their brief in the appeal.  The state’s brief is due May 20th.  Appellants response is due June 3rd.

(Previous Post)
The district court denied the motion for reconsideration.  Her order is here.

(Previous Post)
The district court ruled against the Professor Tanford has sort of filed a motion for reconsideration of the trial court’s decision.    Not sure of the format and why the court would consider reversing itself but I guess it never hurts to ask.   A copy of the request is here.

(Earlier Post ) Indiana Wins;  Retailers and Wineries Are Indeed Different Entities

Federal District Judge Jane Magnus-Stinson issued an opinion for the state of Indiana in the Capt’n Cork case.   She noted that the theory of the plaintiff’s case was flawed in several aspects.  Most importantly she noted that nothing in the Granholm case suggested the expansion of its holding as sought by the plaintiffs.  She noted that state laws have a strong presumption of validity.   She indicated the lack of clarity over the plaintiff’s specific challenges but rejected each one nonetheless.  At the end of the opinion, she rejected a federal preemption claim in part by citing to the Stop Underage Drinking Act of 2006.    It is unclear whether there will be an appeal at this time.

(PREVIOUS POST)  Motions for Summary Judgement Filed in Indiana Retailer Case

A motion for summary judgement was filed by the plaintiffs in the Cap’n Cork case.   Recently Indiana  filed its cross motion for summary judgement.  The recent Wine Country 5th Circuit case as well as the Buy-Rite case from New York in the 2nd Circuit and the other Indiana case, Baude  at the 7th Circuit all heavily influence the state’s brief.  All those cases are discussed in other posts on this blog.

Updated:   This case has been transferred to federal court in Indiana.  It has been assigned to Judge McKinney.

A New Indiana Lawsuit Filed by Retailer Seeking Direct Shipping Rights

Just 24 hours after the United States Supreme Court stated they would not take an out-of-state winery’s unsuccessful challenge to one provision of the Indiana alcohol code, the same unsuccessful plaintiff’s attorney has filed a new lawsuit against Indiana this time on behalf of an Indiana retailer.

A new case has been filed in the Southern District of Indiana, Lebamoff Enterprises Inc. v. Thomas Snow, Chairman of the Indiana Alcohol & Tobacco Commission(PDF). Lebamoff Enterprises dba Cap N’ Cork has filed a challenge under Indiana law, the Equal Protection Clause, the Dormant Commerce Clause and federal preemption of state regulation of  common carriers.  The Cap N’ Cork believes it is unfair that wineries are able to do some sales via common carriers whereas retailers are not.  The ATC has cited Cap N’ Cork  for violations. This will likely be an interesting case to see if wineries and retailers are in fact different as apparently the plaintiff here claims there is no difference between winery sales and retail sales.

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