RICHMOND, Va. — Laws allowing only Virginia wine to be sold in state-run liquor stores and restricting the amount of booze consumers can bring into the state for their personal consumption are constitutional, a divided federal appeals court ruled Monday.

The 2-1 ruling by the 4th U.S. Circuit Court of Appeals reversed a lower court’s ruling that those two provisions of the state’s Alcoholic Beverage Control Act unconstitutionally impede interstate commerce.

The lower court also struck down provisions favoring Virginia over other states in the distribution, delivery and shipping of wine and beer. Because the General Assembly amended the law to reflect that ruling, the appeals court dismissed that portion of the state’s appeal as moot.

In the majority opinion, Judge Paul V. Niemeyer wrote that a “market participant” exception to the U.S. Constitution’s commerce clause allows Virginia’s ABC stores to sell only wine produced in the state.

“Virginia’s choice of selling only Virginia wine is no more inappropriate than would be its choice to sell only Hershey’s brand chocolate bars at a State commissary,” Niemeyer wrote in the opinion, which was joined by Judge William B. Traxler Jr.

Niemeyer noted that more than 10,000 private retailers are licensed to sell wine in Virginia, providing plenty of choice for consumers who want to buy an out-of-state variety.

“There is no evidence that consumers face any impediment to purchasing wines of their preference at fair market prices,” he wrote.

In a dissenting opinion, visiting U.S. District Judge Joseph R. Goodwin of West Virginia pointed out that ABC stores are Virginia’s only one-stop shop for both wine and liquor.

“Virginia has granted itself a monopoly in the market for the joint sale of wine and liquor through its ABC Stores, and uses that monopoly to impermissibly discriminate against out-of-state wines,” Goodwin wrote.

Niemeyer disagreed. “These are matters of convenience, not monopoly power,” he wrote.

The law allowing consumers to bring no more than one gallon (or four liters) of alcoholic beverages across the border is constitutional because it does not restrict how much a person buys from an out-of-state retailer, the appeals court’s majority ruled.

Goodwin wrote that while Virginians theoretically can buy as much alcohol as they want from an out-of-state store, as a practical matter they are limited by the import restriction.

“Having an opportunity to purchase is not the equivalent of having meaningful market access,” he wrote. “…Virginia’s limitation on the quantity of alcoholic beverages a person may bring into the Commonwealth favors in-state economic interests over out-of-state economic interests.”

The lawsuit challenging the ABC Act provisions was brought by five consumers, wineries in Texas, California and Oregon, and a wine and beer retailer in the District of Columbia.

SOURCE: DailyPress.com

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