Texas Narrowly Avoids Felony Bill on Interstate Wine Shipments
Dana Nigro
Posted: June 4, 1999
Texan wine lovers still can't legally have a case of Cabernet shipped to their homes from their favorite California wineries, but at least such deliveries won't be considered felonies. A bill that would have imposed jail time on anyone who repeatedly shipped wine across state lines to Texas consumers has died in the legislature.
The felony bill failed to pass out of the House of Representatives before the legislative session ended. Barring any special sessions called by the governor, the Texas legislature does not reconvene until 2001.
SB427, first introduced in February by state Sen. David Sibley, was backed by alcoholic beverage wholesalers, whose business may be threatened by Internet, phone and mail-order sales of wine, beer and spirits. The bill would have imposed misdemeanor charges on any out-of-state sellers of alcoholic beverages that sent their products directly to Texas residents. After receiving one written warning, the sellers would have been charged with a felony and subjected to jail time for further offenses.
The bill quickly passed through the Senate, but it stalled in a House committee after extensive lobbying by wine industry organizations and consumers was accompanied by media coverage of the issue. The bill eventually passed out of committee, but failed to make it to the House floor for a full vote before the session ended on May 31.
Current Texas law prohibits residents from importing alcoholic beverages unless they personally accompany the bottles as they enter the state. Even then, residents are only allowed to bring in up to 3 gallons of wine per month.
Three Texas wine drinkers have filed a lawsuit challenging this statute, saying it violates their right to free trade under the commerce clause of the Constitution. The group is backed by the Coalition for Free Trade, a nonprofit organization that supports the wine industry's efforts to open up state direct-shipping laws by providing research for consumer lawsuits.
The plaintiffs are C.A. Dickerson, Roland Pennington and David Vukovic, all Houston residents. Their case is being handled by attorneys Sterling Steves in Forth Worth and Mark Harwell in Houston. The group is suing Texas Alcohol & Beverage Commission Administrator Doyne Bailey and state Attorney General John Cornyn. The hearing has been set for Aug. 6.
In the case, the attorneys argue, "There is no legitimate state interest in the statute's blanket prohibition of interstate direct shipments. Instead the statute's blanket prohibition serves the illegitimate economic purpose of protection of Texas distributors and wholesalers against interstate competition."
The suit acknowledges that the current law addresses such issues as tax collection, preservation of the three-tier distribution system (from winery to wholesaler to retailer) and prohibition of alcohol deliveries to minors and dry areas. But the lawyers argue that these interests can be supported in less restrictive ways. In addition, the suit points out that the law discriminates against out-of-state companies because Texas retailers and wineries are allowed to make home deliveries to residents.
"We are pleased with the strength of the Texas consumers' complaint," said Vivienne Nishimura, executive director of the Coalition for Free Trade. "This suit is the first step in overturning the tide of state laws which violate the consumers' greater federal rights to access the products they desire."
For other recent state legislative news:
May 27, 1999
Wine Lovers Score Victory in Nevada, Mixed Results in ArizonaMay 20, 1999
New York Tackles Internet Alcohol Sales April 13, 1999
North Dakota Approves Limited Direct ShippingFor more on federal shipping legislation:
May 26, 1999
Direct-Shipping Battle Moves to House May 19, 1999
Senate Approves Amendments to Restrict Home Delivery of Wine March 19, 1999
Federal Legislators Craft New Bills on Direct ShippingMarch 10, 1999
Senator Moves to Put More Bite Into States' Direct-Shipping BansFor a comprehensive look at the direct shipping issue:
May 15, 1997
When Winemakers Become Criminals
