He’s Back Again. Fourth Time a Charm? Another Amended Complaint Filed in California Out of State Importer Case

Although the district court granted the state’s motion to dismiss,  the plaintiffs in Orion Wine have taken the lifeline to amend their complaint once again in their challenge to California law.   They have reshaped this version as a more frontal assault on the California requirement that alcohol come to rest in California before it goes to retail.

The original complaint in this matter was filed in June of 2018.  The First Amended Complaint was filed in July, 2018.  A 2nd Amended Complaint was filed in October of 2018.  And now, 15 months after they started the lawsuit, the plaintiffs are again amending their complaint against the state.  Presumably the state will once again move to dismiss this lawsuit for failure to state a claim.

(previous post) California District Court Grants State’s Motion to Dismiss Out of State Importer’s Dormant Commerce Clause Challenge

California District Court Judge Kimberly J. Mueller granted the state of California’s Motion to Dismiss a challenge brought by an out of state wine importer under the dormant Commerce Clause.   The court did give the plaintiffs the opportunity to consider if they would like to file to amend their complaint for a third time “if possible subject to Federal Rule of Civil Procedure 11.”  The court’s order can be found here.

This claim involved a Florida importer/wholesaler who claimed a dormant Commerce Clause violation because it claims it cannot sell to California retailers due to various California laws that in-state importers must also follow.

The court noted that the California law is even handed; “Under California Business & Professions Code section 24041, Orion or any other “out-of-state business” may apply for and obtain either or both an importer’s and/or wholesaler’s “license” in California to have alcohol come to rest, be stored, and be shipped from a licensed public warehouse. Therefore, the law, by its terms, applies equally to in-state and out-of-state importers because the statutes at issue require all importers to have a physical premises in California at which to receive delivery of imported alcohol.”

The court saw through the plaintiff’s attack on California system and trained its concern on the theory of the case as presented to her in the second amended complaint; “plaintiffs’ barebones pleading exposes the absence of a full understanding of the regulatory structure and where there is a possibility of obtaining licenses after leasing public warehouse space.”  There was confusion at both pleading and oral argument over what specific parts of the law were problematic allowing the court to dismiss the complaint with leave for the plaintiff’s to attempt to clarify the Complaint a third time. Lastly, the Court concluded that Orion and its owner each lacked legal standing to pursue a claim under the Privileges and Immunities Clause of the U.S. Constitution.

The California Beer and Beverage Distributors and the Wine and Spirits Wholesalers of California jointly filed a friend-of-the-court-brief in support  of California and also appeared and argued at the December hearing in Sacramento.

It is unknown whether there will be an appeal to the 9th Circuit, plaintiffs will refile and amend their complaint, or if they will drop this matter.

(previous post)  Motion to Dismiss Out of State Wholesaler Challenge to California Wholesaler Law Scheduled for December 21, 2018

The Eastern District of California will hear the Motion to Dismiss filed by the state of California on December 21, 2018.   California wholesaler organizations weighed in with an amicus in support of the state and the plaintiff Orion Wine has filed a brief in opposition to the motion to dismiss.

(previous post) Motions to Dismiss Out of State Wholesaler Case in California Filed

The State of California has filed a Motion to Dismiss a Complaint filed by Orion Wine (a Florida company) and a Florida businessman who claim that the three-tier laws of California that require retailers in California to secure their alcohol from California wholesalers is a violation of the dormant Commerce Clause and the Privileges and Immunities Clause.  A hearing is set for this on September 19.  The hearing will actually consider two issues, the state’s Motion to Dismiss an earlier Amended Complaint as well as the Plaintiff’s request to file a second Amended Complaint to further correct errors in it.  A Joint Status Report highlights the issues and expected future briefings, if any, on this case.

The California Beer and Beverage Distributors and California Wine and Spirits Wholesalers have filed a compelling amicus brief at this stage of the filing to argue why this case should be dismissed as the state laws violate neither the dormant Commerce Clause nor the Privileges and Immunities Clause.

(earlier post) New Shipping Lawsuit Filed in California

A new lawsuit was filed in California by the same law firm that has brought pending challenges in Illinois and Michigan.  Their Missouri challenge was dismissed just last week.

The California lawsuit was filed in federal court in the Eastern District of California. The Complaint on behalf of Orion Wine Imports and an owner of the company claims California laws that prohibit out of state importers and wholesalers from serving California retailers while California importers and wholesalers  are permitted violates the Constitution’s dormant Commerce Clause and the Privileges and Immunities Clause.

Similar lawsuits have not been successful to date as the courts have noted that the United States Supreme Court’s 2005  Granholm decision was limited to supplier based discrimination, not disparities in states laws regulating the retailer and wholesaler tiers.


  1. well then why do we in CA have to purchase a non resident wholesalers license to be able to sell to out of CA retailers?

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