District Court Issues Rash Decision. Rules for State of North Carolina and Dismisses Out of State Retailer’s Dormant Commerce Clause Complaint

Pardon the pun but the lawsuit brought by Mike Rash, B-21 Wines, et. al has been dismissed by the district court so I will call it the Rash decision.

United States District Judge Frank Whitney of the Western District of North Carolina has granted the state of North Carolina’s motion to dismiss the effort of the plaintiffs to be able to ship wine from retailers directly to North Carolinians.

Judge Whitney noted that the attempts to claim constitutional protection for out of state retailers like out of state supplier jurisprudence is ill founded. He noted, “Wineries are producers; they are the first tier in a three-tier system and are meaningfully distinct from retailers, the third tier... Allowing producers to circumvent the three-tier system does not undermine the system in the same way allowing retailers to circumvent the system would.

Judge Whitney later reasoned that his decision is relatively straightforward, “Given a choice between virtually eliminating North Carolina’s three-tier system, which the Supreme Court and multiple Courts of Appeals have determined is unquestionably legitimate, and maintaining the status quo, the Court chooses the latter.”

It is unknown at this time whether the plaintiff will appeal.

(previous post)  Court Denies NC Motion to Dismiss Retail Shipping Case

Judge Frank Whitney of the Western District of North Carolina Granted in Part and Denied in Part the effort of NC to dismiss the retail shipping case brought by a Florida retailer and some consumers.   In his order,  Judge Whitney noted the plaintiffs had met their burden to overcome a 12b motion to dismiss.

The Court further noted it is still bound by the 4th Circuit’s  Beskind v. Easley decision from 2003 from the winery direct shipping fights.  The court also noted that the remedy applied in Beskind was to remove in state retailer shipping rather than extend retailer shipping rights to all.

The matter will return to normal discovery and briefing.

(previous post) State of North Carolina Files Motion To Dismiss Retail Shipping Case

The state of North Carolina filed its motion to dismiss against the recent complaint by an out of state retailer challenging laws that permit North Carolina retailers to perform some local delivery functions as a violation of the dorman Commerce Clause.

The state’s brief sought dismissal because the plaintiffs lack standing, the plaintiffs’ complaint fails to state a claim, and that the naming of the Attorney General as a Defendant was improper.

(previous post) Another Retailer Shipping Case Filed – This Time in North Carolina

The lawyer combination of Tanford and Epstein have filed their (at least) sixth retail shipping dormant commerce clause lawsuit since the Tennessee Wine & Spirits Retailers Association decision in the Supreme Court.

This time they have filed a complaint on behalf of Florida business and several North Carolina residents claiming that the North Carolina laws discriminate against commerce.  They claim a North Carolina retail residency law and the lack of the ability of the Florida company to secure a North Carolina permit to ship wine from out of state violate the U.S. Constitution’s dormant Commerce Clause.

Two of the North Carolina resident plaintiffs have the last name Rash.   So this will likely be a Rash decision at the end of the day.  (Sorry, had to go there.)

Comments

  1. Thanks for the update (and the laugh).

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