Breaking Legal News - POSTED: 2010/01/15 17:03
A Massachusetts law that sharply restricts out-of-state winemakers from shipping their products directly to consumers in the state is unconstitutional, a federal appeals court ruled.
Thursday's decision by the 1st Circuit Court of Appeals to uphold a lower court ruling could open the door for connoisseurs in Massachusetts to purchase more of their favorite wines online or by mail order from domestic producers.
The law, approved by the Legislature in 2006 over the veto of then-Gov. Mitt Romney, created a multi-tiered system in which wineries that produce more than 30,000 gallons a year must decide whether to sell retail in Massachusetts through an in-state wholesaler or apply for a license to ship wines directly to consumers. They cannot, however, do both.
The cap does not affect any of the nearly three dozen wineries based in Massachusetts, all of which are small and produce under the 30,000-gallon limit.
"We hold that (the law) violates the Commerce Clause because the effect of its particular gallonage cap is to change the competitive balance between in-state and out-of-state wineries in a way that benefits Massachusetts's wineries and significantly burdens out-of-state competitors," the appellate court wrote in its decision.