The state is being sued in federal court by an Oregon winery that alleges a ban on direct sales of wine over the Internet is unconstitutional.
A legislative committee on Friday voted 9-3 against a bill that would open the borders for direct wine sales from out of state. The measure has not yet been debated by the full Legislature.
In its lawsuit against Gov. John Baldacci, Attorney General Steven Rowe and other state officials, Cherry Hill Vineyard of Rickreall, Ore., alleges that the state discriminates against out-of-state wineries because the only way they can sell directly to Maine consumers is to open a retail store in Maine.
The winery also alleges that state law violates the commerce clause of the U.S. Constitution, which allows for the free flow of commerce among the states.
State law bans the direct shipment of wine to consumers by either Maine or out-of-state wineries, diffusing the argument that the law discriminates against out-of-state operations, according to Assistant Attorney General Christopher Taub.
The state also argues that federal law gives the states the right to regulate and control liquor and wine consumption.
Taub said Monday a U.S. Supreme Court decision in May 2005, which struck down laws in Michigan and New York that banned direct Internet wine sales, is not relevant to Maine’s suit. Taub said the key distinction is that the Michigan and New York laws allowed only in-state wineries to ship their product directly to consumers and therefore did discriminate against out-of-state wineries.
Maine law requires large wineries to distribute their products only through wholesalers, Taub said.
The state is most concerned about direct Internet sales because of the potential for sale to minors which, under Maine liquor laws, is defined as anyone under the age of 21, Taub said.
But law professor James Tanford of the Indiana University School of Law, representing the Oregon winery, said Monday states are slowly modernizing their liquor laws – some for the first time since the end of Prohibition.
Tanford disagrees with Taub on all the key arguments. In particular, Tanford said judges laugh at attorneys general who use the argument that direct sales could lead to illegal sales to minors.
“That argument has superficial appeal,” he said, “but it’s simply a red herring.”
Tanford argues that minors can already get any kind of liquor if they want it. And they usually don’t want wine, he said.
Internet wine sales are expensive and they don’t arrive for up to two weeks.
“They (young drinkers) scrape together $3 for a six pack of beer and they want it now,” Tanford said.
America’s small wineries have given up on trying to get state legislatures to update the liquor laws and instead have turned to the courts. Tanford said laws in more than 20 states have been challenged in federal court since 1998. Half are still pending, but the wineries have won every case but one, he said.
He said the better way to avoid sales to underage buyers is to allow direct shipping, which would require alcohol shipments to be well labeled and for consumers to prove their ages.
Meanwhile, Lt. Patrick Fleming, who oversees liquor enforcement of Maine retailers, conceded Monday the state has no real way to enforce the existing ban on direct sales. Not only does the state lack the money and manpower to track down shipments, Internet liquor sales are hard to track if the buyer isn’t honest about what’s in the package.
Fleming said the state would investigate suspected shipments, on a case-by-case basis, if someone filed a complaint or report.
No one has filed a complaint in the three years since the state all but dismantled its liquor enforcement operation, he said.
“It’s not something you can be proactive about,” Fleming said.
The federal lawsuit is filed in the U.S. District Court in Bangor. Taub said he doesn’t expect a decision until late in the year.