Laws on shipping alcohol from out of state, with their roots in the post prohibition-era, are facing legal challenges in Missouri and elsewhere.
The most recent attempt by a Florida-based wine seller, and two Missouri residents, challenging a bar on direct to consumer sales failed, but others are likely to follow, according to one legal observer.
Laws drawn up following prohibition, which have often clashed with the commerce clause of the U.S. Constitution, are increasingly under pressure in the era of the internet and rising online sales, said Matthew Bodie, a law professor at St. Louis University.
Sarasota Wine Market of Florida and two Missouri consumers filed suit in federal court challenging laws that those seeking to sell alcohol in the state must be a qualified voter and a taxpaying citizen.
The plaintiffs alleged the state's ban on such sales violates the Constitution's commerce clause as it protects businesses in Missouri against competition from those operating out-of-state.
Missouri argued before the 8th Circuit that the move was an attack on the long established three tier system that governs alcohol sales across the country, which has its roots in the passage of the 21st Amendment overturning prohibition.
"We are back to the 21st Amendment, a period when the country decided to end prohibition," said Bodie. "Its passaged allowed (government) to do whatever they wanted to control the sale of alcohol (and) that causes a lot of tension with the commerce clause."
Under the three tier system, states have control over the regulation and licensing of the operations of producers, wholesalers and retailers.
But these rules have face challenges, most notably in Tennessee Wine and Spirits v. Thomas. The U.S. Supreme Court ruled in 2019 that Tennessee’s requirement that a company must have a presence for two years before doing business was unfair.
This followed a 2005 Supreme Court judgment that stated a complete ban on interstate sales of alcohol was unconstitutional.
U.S. Circuit Judge James B. Loken, writing the unanimous ruling of the three member panel, said that the plaintiffs went too far beyond what the Supreme Court concluded.
“Rather, they challenge Missouri’s requirements that licensed liquor retailers be residents of Missouri, have a physical presence in the state, and purchase liquor sold in the state from licensed in-state wholesalers,” Loken wrote, according to Courthouse News, the wire service.
He added, “The licensing requirements and restrictions at issue have been consistently upheld, before and after Granholm and Tennessee Wine, as essential to a three-tiered system that is ‘unquestionably legitimate.’”
"It was not crazy to bring this suit but the court is saying it is not going to push it further than the Supreme Court," said Bodie.
In the Sarasota case, the company wanted to sell direct to the consumer across state lines without having any presence in Missouri, and that is not yet allowed.
But the state cannot throw up barriers, such as a rule ordering them to be resident in the state for a certain number of years, before they are allowed to sell to consumers.