Today the 8th Circuit released its judgment and opinion in the Southern Wine and Spirits challenge to Missouri’s alcohol code. In its opinion, the court upheld the decision of district court Judge Nanette K. Laughrey. The 8th Circuit dismissed the Commerce Clause and Equal Protection challenges to Missouri law. The 8th Circuit joins the 2nd, 4th and 5th Circuits in clarifying that the Granholm v. Heald decision in 2005 was limited to alcohol producers.
The 8th Circuit noted “states have discretion to establish their own versions of the three-tier system, and Granholm itself announced the unquestionable legitimacy of the three-tier system in a case involving two different versions of that system from New York and Michigan.” The Court concluded that the state had rational reasons for the laws it passed and concluded that “the Division has established a sufficient basis for its residency requirement, which is meaningfully tied to the “aim of the Twenty-first Amendment . . . to allow States to maintain an effective and uniform system for controlling liquor by regulating its transportation, importation, and use.”
NBWA along with the independent retailer group American Beverage Licensees, the Missouri Wine and Spirits Association and several state Attorneys General submitted amicus briefs in support of the trial court decision.
(earlier post) Oral Argument Held in 8th Circuit Challenge By Southern Wine & Spirits
Today the 8th Circuit held oral arguments on Southern Wine & Spirits appeal of the district court’s ruling in favor of Missouri regarding their wholesaler licensing law. The history of the case and briefing is provided at length below. Sitting on today’s panel were 8th Circuit Judges Colloton and Shepherd as well as Iowa District Judge Rose by designation. Judge Rose sure had an interesting case for her first 8th Circuit case.
The oral argument was professional and intellectual with all attorneys representing their positions well. Each side had roughly the same amount of questions asked of them. Judge Shepherd seemed to have an extra interest in the mechanics and rationales for the “grandfather” provision of the law that allowed an out of state wholesaler access to Missouri roughly 16 years ago. Judge Colloton probed for the boundary of where Granholm v. Heald holding on 21st Amendment ends and the subsequent decisions in the 2nd, 4th, and 5th Circuits which noted that Granholm applied to discrimination against producers and products only and states have a wide latitude under the 21st Amendment to regulate against the wholesaler and retailer tier of the unquestionably legitimate three-tier system.
It is always dangerous business guessing “who won” oral argument as it is pure speculation. Rather than offering a wild prediction, I will let you listen to the oral argument and draw your own conclusions. Here is a link to the oral arguments.
It is unknown when an opinion will be issued but I imagine it will be issued on a Friday afternoon while I am trying to leave for vacation this summer as Murphy’s Law seems to control timing of these things.
(earlier post) Final Briefing in 8th Circuit on Challenge to Missouri Residency Law
Southern has filed its reply brief for its appeal to the 8th Circuit. The 8th Circuit has many pages and arguments to wade through and an oral argument will most likely follow in early 2013.
Southern’s most recent filing seeks to push the Bacchus case (the infamous okolehao tax break by Hawaii struck down) as controlling this matter. Moreover, the 8th Circuit will have to reconcile the lack of legislative history, the State court’s rejection of it, and the presence of some ancient newspaper articles that each side can claim helps them prove the “noble” or “evi”l intentions of the 1947 Missouri legislature. Probably all can agree that the barren record here will get mentioned by the 8th Circuit for good or bad.
(earlier post) Missouri and Four Different Amici Briefs Filed With 8th Circuit
The Southern Wine and Spirits lawsuit against the state of Missouri about their ability to wholesale alcohol over 5% has heated up in the past week with five briefs being filed to respond to Southern’s briefs which were covered earlier.
First the state of Missouri had a comprehensive brief addressing the issues raised by Southern as well as defending the trial court’s decision. Most of the analysis focused on the dormant Commerce Clause aspects of the challenge with a strong endorsement of the activities of the 2nd Circuit in Boyle and the 5th Circuit in Wine Country Gift Baskets.
Additional briefs were filed by the attorneys general of Arkansas, Texas, Nebraska, South Dakota, Delaware, Mississippi, and West Virginia. Click here for their brief. Four of the seven states in the 8th Circuit are represented here.
The American Beverage Licensees filed a brief representing the national interests of independent retailers highlighting how the issues raised in this appeal are broader than just the wholesaler tier of a three tier system.
The Missouri Wine and Spirits Association filed a brief supporting affirmance with a strong focus on how Granholm limited its application to the alcohol producer level as well as delving into the factual record of the license application at the root cause of this lawsuit.
Finally, the Missouri Beer Wholesalers Association and the National Beer Wholesalers Association filed a brief highlighting why the district court was correct on both the dormant Commerce Clause as well as the Equal Protection issues. The brief also highlights some additional newspaper articles to counteract articles introduced in the briefing by Southern. As subsequent articles show, the Missouri law was clearly for protection of valid public policy reasons.
Southern gets to file a reply brief and then this goes off to oral argument in 2013. With the 2nd Circuit and 5th Circuit rulings already on the scope of the dormant Commerce Clause, Southern may try to brief life into a 1994 5th Circuit Cooper opinion but will have a huge obstacle with the later 5th Circuit ruling, the Supreme Court’s holding in Granholm as well as the fact that the magic words “three tier” were never mentioned in that soon to be 19 year old matter.
(Earlier Post) Extension Granted, One Amicus in 8th Circuit
The Court has issued an order extending the briefing for the state to respond to Southern Wine and Spirits appeal to the 8th Circuit in Missouri until November 9, 2012. Any amicus in support of the Missouri would be due by November 16, 2012. Appellants reply brief is due December 17, 2012.
Also, an amicus in support of Southern was filed by Missouri Beverage Company this week. They support the Southern brief and add additional issues including the potential lack of market for their business as a reason why this Missouri law violates the Constitution.
(earlier post) Southern Files Brief Before 8th Circuit
Southern Wine and Spirits filed its brief in its appeal of its lawsuit against the state of Missouri. In its 45 page brief Southern through its new counsel concentrates mostly on the dormant commerce clause challenge with a few pages on the equal protection claim. There is no mention of the privileges and immunities challenge they raised at the trial level.
The attorneys concentrate on what they feel the protectionist nature of the Missouri law and a lack of evidence by the state to defend the policy.
Interesting that Southern cites to the recent Kentucky trial court decision to support its equal protection claim. (The Kentucky case is being appealed to the 6th Circuit and that information is also on this website.)
Much more on Southern’s appeal in the next few weeks.
(Earlier Post) Missouri Court Upholds Alcohol Residency Law
While the number of lawsuits against state alcohol codes is down substantially, there are still a few interesting cases percolating through the system. Besides the Kentucky update of yesterday there is breaking news from Missouri. Last summer, Southern Wine and Spirits filed litigation to challenge the three year residency requirement for liquor wholesalers in that state. Their complaint is here and alleged violations of the Commerce Clause, Equal Protection and Privileges and Immunities Clause. Major Brands intervened as a Defendant. The parties filed summary judgement motions at the beginning of this year and the district court issued an order yesterday siding with the state.
Judge Nanette Laughrey’s opinion spends most of the time on the Commerce Clause claims and quickly distinguishes the Granholm v Heald 544 US 460 (2005) and its emphasis on discrimination against out of state producers or goods versus the rest of the Granholm which clearly expressed support for the three tier system. The court cited to pro three tier language from the Granholm decision “the three tier system is unquestionably legitimate” as well as the California Liquor Dealers Ass’n v. Midcal Aluminum Inc 445 U.S. 97, 110 (1980) noting that the “Twenty-first Amendment grants the States virtually complete control over …how to structure the liquor distribution system.” The court distinguished a 5th Circuit case from 1994 that was decided before Granholm. It maintained the analysis used in the 5th Circuit case is no longer appropriate given the Supreme Court’s clarification in the Granholm decision.
I am sure there will be much more written on this including by me but I gotta go.
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