Want wine from out of state? Court to decide

Browsing the Web, you're intrigued by a wine whose California vintner boasts of its "powerful aromas of black cherry, raspberry, blueberry and violet with a bouquet of vanilla, tar and smoky oak."

But when you try to place an online order for a $32 bottle of J. Lohr's 1999 Vineyard Series Hilltop Cabernet Sauvignon, you find it's off-limits to you.

You're from Florida, one of 20 states that bar direct shipment of wine from out of state.

On Monday, the U.S. Supreme Court agreed to rule whether such laws are an unfair constraint of trade or a valuable protection against underage drinking and liquor industry price-fixing.

Consumers in Florida and other affected states are caught in the middle, often unable to fill their online shopping carts with promising vintages from California or Washington state.

"It's protectionist, and it's discriminatory," said lawyer Clint Bolick, who represents a family-run winery in Virginia that complains it cannot get its bottles to would-be buyers in New York. Those attempting to overturn the state restrictions cite the Constitution's clause giving Congress the right to regulate commerce across state lines.

But defenders of state restrictions such as Florida's cite another clause of the Constitution: The 21st Amendment, which ended Prohibition in 1933 and handed control of alcohol regulation to state governments.

"The historical basis for the (state) structure, as recognized by this court, is to protect against the collusion, price-fixing and monopolization problems that existed before Prohibition," attorneys for Michigan Gov. Jennifer Granholm wrote.

Michigan appealed to the Supreme Court after a lower court ruled in favor of husband-and-wife wine reviewers who challenged that state's restrictions on direct wine shipments.

The wine-online dispute is fueled in part by states determined to collect their share of taxes from the wine industry, which reported $21.6-billion in sales last year, and by wine wholesalers determined to guard their profitable role as middlemen. Among the biggest players is Southern Wine & Spirits of Miami, which brings in about $2.8-billion in annual revenue from its eight-state operation, according to the Wall Street Journal.

Then there's the prospect of teenagers buying wine with a few clicks of a mouse. State regulators say that's a real danger, although online merchants say delivery services such as UPS have established procedures to check IDs before handing over a shipment of Merlot or Chardonnay.

With the inventiveness that typifies the Web, some online merchants have found ways around the state restrictions. For example, wine.com of San Francisco, which bills itself as the largest online wine merchant, fills orders in states that have restrictions. In Florida, it made a deal with Southern Wine & Spirits to serve as its wholesaler, and it set up a small outlet in Dade County.

"We actually have a license in the state of Florida and we have essentially a retail outlet in the state," said Chris Kitze, chairman of the board at wine.com. Asked if consumers could drop by the outlet to purchase wine, Kitze said, "Technically, they can."

But Tracy Genesen, legal director for the wine industry's Coalition for Free Trade in Sacramento, Calif., called such strategies a "convoluted three-tier system, which would cost you more money" as a consumer.

Unless the Supreme Court overturns laws like Florida's, she said, "You cannot get a bottle of wine to your home as you could get a T-shirt from Land's End."

The high court agreed Monday to address the dispute through cases from Michigan and New York. A suit challenging Florida's law is still before a lower court, according to Genesen.

- Information from the Associated Press was used in this report.

The 20 states that forbid or constrain interstate wine shipments, as of April 1, according to the National Association of American Wineries: Florida, Arizona, Arkansas, Delaware, Kansas, Maine, Massachusetts, Michigan, Mississippi, New York, Oklahoma, Rhode Island, South Dakota, Utah, Vermont, Georgia, Indiana, Kentucky, Maryland and Tennessee.

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