Three-Tier System and State Authority to Regulate Alcohol are Supported by Twenty-First Amendment and Prior Supreme Court Cases, WSWA Notes in Amicus Filing

Association Files Brief in Tennessee Wine & Spirits Retailers Association v. Clayton Byrd, Et Al.

(WASHINGTON, D.C.) – The U.S. Supreme Court has long-upheld that the Twenty-first Amendment provides each state with authority to pass laws and regulations over the distribution and sales of beverage alcohol within its borders, Wine & Spirits Wholesalers of America (WSWA) highlighted in an amicus brief filed today with the Court in Tennessee Wine & Spirits Retailers Association v. Clayton Byrd, Et Al.  This primary authority is protected under the Twenty-first Amendment in light of dormant Commerce Clause challenges, subject to very narrow and previously-defined limits set by the Court.  Accordingly, a lower court decision to the contrary should be overturned, WSWA’s brief noted.

The brief outlined how a U.S. Court of Appeals for the Sixth Circuit ruling, which led to this Supreme Court case, “gets the constitutional analysis exactly backwards.  As the history of the Twenty-first Amendment demonstrates, apart from repealing Prohibition, the whole point of the Amendment was to create an exception to the normal operation of the Commerce Clause,” as the Court has noted in prior cases.  “In this setting, a party who challenges a state liquor regulation as ‘discriminatory’ in violation of the Commerce Clause is, as a practical matter, advancing a claim the Amendment was expressly designed to extinguish.”

WSWA explained that the Twenty-first Amendment affirmed each state’s authority to regulate liquor within its jurisdiction in the manner that best fits its particular circumstances.  “The text and history of Section 2, as well as this Court’s early precedent, confirm that the “aim of the Twenty-first Amendment was to allow States to maintain an effective and uniform system for controlling liquor by regulating its transportation, importation, and use.”

“The modern three-tier system and its producer, distributor and retail components are all  part of making the U.S. alcohol market the safest, most diverse, competitive and innovative in the world,” WSWA President and CEO Michelle Korsmo said.  “This system is made possible because of the authority exercised by each state over their licensed wholesalers, suppliers and retailers.  WSWA has long advocated, and our brief underscores, that this authority is what makes this system unquestionably legitimate and uniquely successful when compared against all other markets,” Korsmo added.

“WSWA and our members believe strongly in the preeminence of state authority over their licensees and look forward to the Court hearing this important case in the months ahead.”

The brief was crafted by a team led by Miguel Estrada, a partner with Gibson, Dunn & Crutcher, LLP.  Click here to view a copy of the brief.

WSWA is the national trade association representing the distribution tier of the wine and spirits industry, dedicated to advancing the interests and independence of distributors and brokers of wine and spirits.  Founded in 1943, WSWA has more than 370 member companies in 50 states and the District of Columbia, and its members distribute more than 80 percent of all wine and spirits sold at wholesale in the U.S.   Visit wswa.org to learn more.