I feel very confident that the legal issues raised in this litigation will reappear in another case in the future.

(earlier post)   10th Circuit Reverses and Remands US Airways Case Back To District Court

The 10th Circuit today reversed and remanded the district court’s decision which had ruled in favor of New Mexico.    When the district court gets this case again, it is instructed to balance both the state interests under the 21st Amendment and the federal interests under the Federal Aviation Act.   It is unclear if any party will try to appeal this to Supreme Court at this stage.  The 10th Circuit opinion can be found here.

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Oral Argument Set for September 20th in the 10th Circuit Appeal of USAIR Case

The oral argument of US Air’s appeal is set for September 20th in Denver before the 10th Circuit.   In a twist, the US Government has pushed to be allowed to participate in the oral argument and has been granted time. The motion the federal government filed to participate in oral argument is here.

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Appellate Briefs have been filed in the 10th Circuit.   Retailers, Mothers Against Drunk Driving, State AGs, US Justice Dept, three of the past  U.S. Solicitor Generals representing corporate interests , the list is long!

Four briefs have been filed in support of the State of New Mexico by:
-American Beverage Licensees , State AGs, Mothers Against Drunk Driving and Wine & Spirits Wholesalers of America

The state of New Mexico appellate brief is here.

The State AGs brief notes that the position of the USAir and appellants that they do not need to follow New Mexico alcohol laws would also support the amazing position that US Air could serve drinks to 11 year olds.

Four briefs have been filed in support of US Airways by:
-Air Transport Association of America, Association of Flight Attendants, Ten Former Secretaries of the DOT, and The United States

(The below was written after the trial stage and before 10th Circuit filings)

If you sell liquor to consumers in New Mexico, you need to be licensed by the state to do so. Period.

United States District Judge M. Christinia Armijo has rejected US Airways claims that federal aviation statutes and regulations (specifically the Airline Deregulation Act and the Federal Aviation Act) preempt New Mexico laws requiring every person selling alcohol to secure a public service license.  In her decision Jude Armijo noted there was no basis to assume Congress intended federal law to regulate alcohol service and that state laws are not preempted.    She noted:

Needless to say, the stakes are pretty high with this case and I personally expect an appeal by the Plaintiff in this case.    New Mexico is in the 10th Circuit.

This case further provides a strong rejection to the attempts to allow revisionist history to claim that the 21st Amendment essentially only allows a state to decide wet or dry issues.  The complaint implied that the 21st Amendment  allows a state “ONLY” to regulate the transportation or importation.  That very limited view of the 21st Amendment will not prevail.

Briefs have been filed in this case.

A press article summarizing these developments is here.

(earlier post) New Lawsuit Filed in Utah Challenging Pricing and Licensing Laws

The Utah Hospitality Association has filed a lawsuit against the state of Utah alleging that state law violates the federal Sherman Antitrust Act.  Specifically the complaint is alleging that the state laws related to retail drink price specials and the state limitations on retail licensing are violations of federal antitrust law.  (The complaint also appears to imply an equal protection challenge.)

A related newspaper article from the Salt Lake Tribune describing the lawsuit can be found here.    It  is interesting to note that the plaintiffs imply that they have filed this lawsuit to get the attention of the elected leaders in Utah.   If so it may be a good test of what was referenced in the Federalist 78: “The Courts must declare the sense of the law; and if they should be disposed to exercise will instead of Judgement, the consequences would be the substitution of their pleasure for that of the legislative body.”

I’ll add this to the list of cases to monitor.

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

UPDATE:

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.

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The district court denied the motion for reconsideration.  Her order is here.

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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.

Judge Sparks struck down three provisions of the Texas ABC code for violating the 1^st Amendment right to commercial speech.   He upheld the equal protection and commerce clause challenges to the Texas code.  Texas has some unique laws on “ale” and “beer” definitions and Judge Sparks did not have nice things to say about the state’s defense of these laws.

The portions struck include:

1.  The “tied house” rule prohibiting brewers and beer wholesalers from advertising which retailers sell their beers.
2. The labeling and advertising rules requiring beer products containing 4% alcohol by weight as  ”beer” while requiring beer products containing more than 4% to be labeled “ale” or “malt liquor.”
3. The beer advertising rule prohibiting references to strength.

The portions of ABC code upheld:

1.  Regulations prohibiting breweries from selling their products at the point of production while allowing wineries and brewpubs to do so.
2. Regulations prohibiting brewpubs from selling their products to distributors and retailers while allowing wineries and microbreweries to do so
3. Regulations treating foreign breweries as the first American source of supply of malt beverages while treating importers as the first American source of supply of wine and distilled spirits.

Again, the sections struck down were mostly unique to Texas but there may be follow up questioning about similar federal laws.    Also, the judge made it clear that his opinion that it was limited to the challenged three sections of the ABC Code and should not be seen as an invitation to strike down the entire statute; “ Within this limitation, however, nothing in this opinion should be construed as preventing Texas or TABC from prohibiting, through appropriate statute or regulation, any undue collusion, financial or otherwise, between producers and retailers. “

Also, there was a hearing today on the preliminary injunction in Cowlitz County.  The judge did not grant the PI and apparently did not deny on basis of probability of success on the merits.

Sorry for the non linkable information.

(Earlier Post) Second Lawsuit Filed Against Recently Passed I-1183 by Retailers and Public Health Officials

A second lawsuit was filed in Cowlitz County against the recently passed I-1183. Interestingly, Cowlitz County was one of the five Washington counties that voted against I-1183.   This complaint was filed by a retailer, an landlord for a state liquor store and the Washington Association for the Prevention of Substance Abuse and Violence Prevention.  They also filed a motion for preliminary injunction (which for some reason is too large to be uploaded to this site right now) and a hearing date on the injunction could be as soon as next week.

(Earlier Post)    Litigation Filed in Washington State Challenging Recently Passed I-1183

 Teamsters Local 174 and the United Food And Commercial Workers (UFCW) Local 21 have filed a lawsuit challenging the initative passed in Washington state.   The complaint can be found here.   I-1183 was a proposal funded mostly by the Costco Corporation which is based in Washington.  A list of Costco’s contributions for I-1183 can be found here.  By my guesstimation Costco has spent nearly $35 million over the past 10 years trying to rewrite Washington state liquor laws.   I-1183 won with over 58% of the vote.

The nuances of Washington state law and their court’s ultimate interpretation of their  “single subject” law is above my pay grade.    I do note that this initiative was indeed boldly written and as a result it does cover many various subjects from “getting state out of the liquor business” to “deregualting wine distribution” to “creating a new marketplace for large retailers” to “a new taxing and revenue scheme” to “state aid to local governments” as a few of the many topics.  Costco will argue they are all related.  The Unions and others will note that this is classic “logrolling”  and a purposeful attempt to try to hide things behind a bigger concept.    We’ll have more as this develops.

(Earlier Post)    Supreme Court Asked to Consider Dormant Commerce Clause Case.

Direct TV has filed a petition for the Supreme Court to overrule the Ohio Supreme Court on dormant commerce clause grounds.  The Ohio Supreme Court upheld an Ohio law that taxed cable at lower rates  than satellite television.   Since the cable industry employs more Ohio residents than satellite TV it is alleged by the petitioners that this method of taxation is a protectionist violation of the dormant commerce clause.   The state of Ohio disagrees in its brief in opposition.   They rephrase the question “May a state, consistent with the Commerce Clause, tax satellite television services differently from cable broadcast services, given  their different methods of operation and the different regulatory sttructure that applies to each? 

Interestingly, the Specialty Wine Retailers Association filed an amicus brief in support of the petitioners claiming that “the wine and satellite TV industry are just the tip of the iceberg” for oppressive tax regimes by the states if the Ohio ruling stands.  Other amicus briefs  supporting the petition were filed by law professors and the National Taxpayers Union.

The United States Supreme Court is currently in its summer recess.  No oral arguments are scheduled until October.  They have had a long summer to where possible cases for consideration accumulated. No conferences are scheduled until Monday, September 26.   At that conference, the Justices will select cases for review from the summer lists.  Given the backlog of cases since their last conference in May, it is possible some decisions may not be made at the conference on September 26. 

Thanks to Scotusblog  for the heads up on the developments in this case. 

(Earlier Post)  Ohio Supreme Court Case With Commerce Clause Implications

Thanks to David Raber of Ohio for catching  and forwarding this one. 

The Ohio Supreme Court has upheld a state sales tax for satellite TV providers that cable competitors don’t have to pay, rejecting arguments from the satellite industry that the tax is unfair and unconstitutional.     In the 5-2 decision rendered 12/27/10, the Court ruled that the 2003 tax does not violate the U.S. Constitution’s Commerce Clause because the tax is based on differences between the nature of the businesses and does not favor in-state interests at the expense of out-of-state interests.

The Granholm and Bacchuscases are distinguished page 13 of the decision.   There was an amicus curiae brief filed by the Specialty Wine Retailers Association urging reversal which is attached here.   The brief waves the flag of internet regulation freedom. It was interesting to note the brief “blamed” certain state alcohol laws on other wineries or retailers for a change instead of  the supposed unchecked wholesaler power in the state house;  ”location specific” language-i.e., “in person” or “on the premises”-and are enacted for the sole purpose of favoring local wineries at the expense of out-of-state wineries, states will defend these statutes as doing nothing more than distinguishing between two “modes” of selling wine to consumers.”

(earlier post) Illinois Lawsuit Seeks to Equalize Beer, Wine, Liquor Tax Rates? Related to tobacco?

There is a new Illinois lawsuit seeking to stop the recently enacted increases in beer, wine and spirits taxes.   There are several arguments advanced in the complaint.  Of interest to me is its discussion of beer taxes vs. wine/liquor taxes.  In a new twist on the long running equilization debate, the plaintiff claims it is unfair underIllinois law that higher alcohol products are taxed at a higher rate than lower alcohol products.   A copy of this lawsuit is available for your review.

The keynote address will be by Washington Attorney General Rob McKenna.  Attorney General McKenna is currently chairman of the National Association of Attorneys General and will address issues facing  state Attorneys General across the country on issues relating to alcohol.

Other sessions include programs on controversial alcohol products, a Supreme Court review, privatization, and franchise law.  Each attendee will receive a copy of the 1933 book Toward Liquor Control in conjunction with a session discussing its relevance to modern alcohol policy.

Here is the agenda.    More information on the Center for Alcohol Policy can be found here.

(earlier post) 7th Circuit  Dismisses ABInBev v. Illinois

The 7th Circuit has dismissed the appeal by ABInbev on its attempt to  vertically integrate and own the distributor in Chicago.   Recent legislation signed into law by Governor Quinn has mooted this matter.    The order will be found here.      The billion dollar question is whether ABInbev runs back to court to challenge the new law. 

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Well the Governor has not yet signed the previously mentioned legislation and the federal courts have their deadlines so any amicus brief in support of the state of Illinois position was due today.  In a brief filed by the Association of Beer Distributors of Illinois and the Marin Institute, the parties urge the 7th Circuit to properly confine the remedy aspect of the litigation (the only issue on appeal) to nullification rather than extension.   Actually the case law on this subject is interesting and someday the Supreme Court will clarify this issue.   It is expected that the signing of this legislation will moot this pending case so this amicus brief may raise issues only to be solved by some future lawsuit.  When a future court does face this issue they will have to deal with the current mischaracterization of remedy from the  Heckler v. Mathews, 465 U.S. 728 (1983) case dealing with welfare policyand a stated goal of extension compared to alcohol policy and the 21st Amendment’s call for states to be making decisions on alcohol policy, not courts.   It is a good reminder of  what was said in the Federalist Papers: “The Courts must declare the sense of the law; and if they should be disposed to exercise will instead of Judgment, the consequences would be the substitution of their pleasure for that of the legislative body.”  The Federalist 78

Will this case be mooted or proceed?  I guess that is the next post.

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(Earlier Post)  Legislation on Way to Governor. What to Do About Pending Appeal?

This week the Illinois House Of Representatives passed without objection legislation that addresses the subject of this litigation.   They have passed a law allowing all breweries under 15,000 barrels to self-distribute up to 7,500 barrels.   This addresses the law that had been struck down in the district court that Anheuser-BuschInbev challenged.

However, it is unlikely the Governor will sign this law before Judge Dow’s May 31st deadline.   Also, the briefing schedule for the 7th Circuit required the state to file its response brief this week.  As a result, the Illinois Attorney General’s office filed its reply brief here.  It disputes much of the assertions of Anheuser-BuschInbev, makes the case for a remedy of “levelling down” and also calls for an extension of the May 31 deadline.   The Illinois Attorney General’s office maintains that the signed legislation will moot this case.

By most accounts, the legislation should moot this case.  However, the state has got in its legal brief placeholder in should the 7th Circuit decide to rule on the matter anyway.

(Earlier Post) Update in 7th Circuit:  Tension in Illinois About What Litigation Means To Legislative Session

As you may recall, Judge Dow stayed his decision until May 31, 2011.    In the interim, scores of lobbyists have been retained and numerous articles have been written about the legislative sausage making in Springfield.   In response to ABInbev’s motion for a stay, the IL AG has filed briefings noting its frustration over the lobbying tactics and representation of the status of the litigation to legislators.  It is now up to Judge Dow to rule on ABInev’s motion for a stay.

If legislation is passed, it may moot the underlying case.   If not, the 7th Circuit will have to rule on the issue of remedy.  Level up or level down…That is the question….

(earlier post)  ABInBev Files Brief in 7th Circuit

ABInBev filed its brief in the 7th Circuit.  13 pages of “facts” and 34 pages of “legal argument” in this “brief.”   Now we know why ABInBev needed extra time to file this brief.  It is interesting that in the thousands of words in this document, the 21st Amendment is cited just once.   Here is a copy of the brief.

(earlier post) -ABInBev Playing Hardball On Attorney Fees in Illinois?

Although I don’t link to all the court filings in this matter, ABInBev is apparently trying the old full court pressure technique against the state AG office on attorney fees.   On one hand ABInbev says their case was cut and dry and was an easy case to win, yet they also claim they need their attorney fees now  despite their outstanding appeal of the portion they lost on remedy.  Moreover, the state has balked at the size of these fees for the “simple” litigation.   Normally a company with a $100 billion market cap could wait a few more weeks for all issues to settle or is it a part of the coorindated strategy of turning up heat on all fronts?

The judge has ruled that the attorneys fees portion will be decided earlier, however, he did express the beginnings of some thoughts that ABI may be disappointed in the amount they are entitled to in this “simple” litigation.

The order can be found here.  In addition to the full court press with the lawyers, ABI apprently is throwing the kitchen sink in public and private negotiations as the clock ticks on this matter before the March deadline.

( Earlier Post) ABInBev Files Appeal to 7th Circuit on Chicago Branch Issue

ABInBev filed its appeal of the district court’s decision which did not allow ABI to vertically integrate the Chicago market.   As a result, it is starting the process to appeal to the 7th Circuit.    The notice of Appeal and docketing statement can be found here and here.

Previous Posts:

Apparently ABI will not be running a branch in Chicago, at least  in 2010.   District Judge Robert Dow has issued an orderin the Anheuser-Busch InBev lawsuit against Illinois.   In his order he grants ABI’s partial motion for summary judgment on the Commerce Clause claim.   However, for a remedy he  has rejected ABI’s call to extend the self-distribution privilege to out-of-state brewers and has “nullified” the right of in-state breweries to self distribute.   He has  stayed his order and turned this back to the state legislature for a permanent solution  by March 31, 2011.   The opinion can be found here.  At this point, it is unclear whether ABI will appeal this to the 7th Circuit, file  a new case in state court, or just hire every lobbyist within a 100 mile radius of Springfield to try to change the law.   Interestingly, Judge Dow stated in a footnote that treating small producers differently is permissible and cited to the use of volume caps.   I am sure there will be more.

Updates in ABI Litigation against Illinois; Oral Argument on MSJ 6/16

The court issued a rulingtoday setting oral argument for ABI’s Motion for Summary Judgement for June 16.  It the decision it denied the Wine and Spirits Wholesalers of Illinois attempt to intervene in the lawsuit.  However it agreed to consider the arguments made by WSWI as well as those by the Associated Beer Distributors of Illinois in its Amcius brief as they raised isssues such as jurisdcition and constitutional avoidance that the court must consider.    ABI will have a chance to respond to those arguments by June 8.

ABI has filed their response brief.

The Associated Beer Distributors of Illinois filed their amicus brief and motion to intervene in the ABI litigation.

The state of Illinois has filed their brief opposed to ABI’s motion for summary judgement.  Read it here.

AnheuserBuschInBev filed their motion for summary judgement read it here.

As you recall, the Illinois Liquor Control Commission handed down a declaratory ruling last month that Anheuser-Busch, as a non-resident dealer, cannot own a controlling interest in a distributorship in the state.  It warned that City Beverage could lose its license if it attempts to proceed withthis deal with ABI.

ABI was trying to buy the remaining 70% of Soave Enterprises in Illinois. This ruling has been challenged. Read the complaint here.

The Illinois Wine and Spirit Wholesalers filed a motion to intervene in this matter. Read it here.

Wow.  “Rare” wine collectors and their law firms are crying foul that they were awarded “only” $675,000 in fees and expenses for the 1st Circuit volume cap matter.  They have filed this notice of appeal of United States District Judge Zobel’s recent order granting the plaintiffs $615,000 in attorneys fees and $62,000 in expenses.   This despite  the National Law Journal quoting one of the attorneys here:   ”Gerald Caruso, a litigator at Rubin & Rudman, said his research shows that Genesen’s fee award is among the highest awarded in the District of Massachusetts in a civil rights case.”   They want more.

So a statute designed to right the wrongs of a dangerous and oppressive government (think police brutality) is now  being used to reward those who fancy expensive wine with state tax dollars for a legitimate question about how Massachusetts set up laws to regulate small wineries.  Not sure that this fact pattern is what this civil rights statute was originally intended to address.  Judge Zobel has already helped oversee the fee request go from $2.1 million down to her present order,  I wonder if Judge Zobel can cut the fee more on appeal?

(earlier post)  Wine Companies and Wine Lovers seek $2 Million from Massachussetts Taxpayers

The aggrieved oenophiles and wine companies have filed their petition for attorneys fees after winning in the First Circuit.   Claiming 3,633 hours of work, the plaintiffs seek  $2,062,343 from Massachusetts taxpayers for declaring that the state’s facially neutral volume cap law treating big and small wineries differently was unconstitutional despite being upheld in Arizona and Kentucky.   Interestingly, the law firm seeks to be paid at 2010 rates and notes that this was a “test case.”   More tests to come?

A copy of the petition can be found here.