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Shows that Pennsylvania Vintners did have the State Legislature pass a law permitting them to ship directly, while prohibiting out of state Vintners the same right. Under this ruling that is now illegal. The next question is what will the Pennsylvania Liquor Control Board (PLCB) and the State General Assembly do about it.
If neither does anything the Courts will have to make a decision. The courts will have to decide what is the State law given this ruling. What I mean does this ruling strike down the Restriction on out of State vintners OR does this ruling strike down the right of in state Vintners to make such shipments. The Michigan and New York Laws in question clearly prohibited out of state shipment of wine but permitted in state shipments of wine. This seems to be why these two cases were taken on by the Supreme Court. Pennsylvania law is a general ban with an exception for instate vintners. Thus the State Courts can rule that the Supreme Court Decision strikes down THE EXCEPTION while KEEPING THE GENERAL RULE. Thus the Courts can rule that the exception permitting in state wineries to ship wine direct is what violates the Commerce Clause NOT the General ban against importing wines.
I see this being resolved by a Ruling from the PLCB that the Winery exception is unconstitutional and inform all such wineries that they must stop direct shipment of wine and that any shipments must be through the PLCB owned system.
Here is the General Rule:
§ 5-501. License required
Except as otherwise provided in this article, and except as otherwise provided in article four as to malt and brewed beverages, it shall be unlawful for any person without a license obtained under provisions of this article to hold in storage as bailee for hire, or transport for hire, any malt or brewed beverage, or to manufacture, produce, distill, develop or use in the process of manufacture, denature, redistill, recover, rectify, blend, reuse, hold in bond, hold in storage as bailee for hire, or transport for hire, within this Commonwealth, any alcohol or liquor, except that a person may manufacture wine out of grapes grown in Pennsylvania by fermentation only and with no alcohol or alcoholic product added thereto by way of fortification and sell the same to a licensed winery.
Here is the ban on Shipping into Pennsylvania AND a limited right to direct ship. This limited Right is part of the problem under this ruling. Pa, unlike other states, did permit some direct shipments but only to PLCB stores:
§ 4-488. Shipment of wine into Commonwealth
(a) The shipment of wine from out-of-State to residents of this Commonwealth is prohibited, except as otherwise provided for in this section.
(b) Notwithstanding any other provision of this act or law to the contrary, a person licensed by another state as a producer, supplier, importer, wholesaler, distributor or retailer of wine and who obtains a direct wine shipper license as provided for in this section may ship up to nine liters per month of any wine not included on the list provided for in subsection (c) on the Internet order of any resident of this Commonwealth who is at least twenty-one (21) years of age for such resident's personal use and not for resale.
(c) Each month, the board shall publish on the Internet a list of all classes, varieties and brands of wine available for sale in the Pennsylvania Liquor Stores. A person holding a direct shipper license may ship only those classes, varieties and brands of wine not included on the list at the time an Internet order is placed.
(d) An out-of-State wine shipper shall:
(1) Not ship more than nine liters per month on the Internet order of any person in this Commonwealth.
(2) Report to the board each year the total of wine shipped into this Commonwealth in the preceding calendar year.
(3) Permit the board or the Secretary of Revenue, or their designated representatives, to perform an audit of the out-of-State wine shipper's records upon request.
(4) Be deemed to have submitted to the jurisdiction of the board, any other State agency and the courts of this Commonwealth for purposes of enforcement of this section and any related laws, rules or regulations.
(e) A direct shipper may ship wine on the Internet order of a resident into this Commonwealth provided that the wine is shipped to a Pennsylvania Liquor Store selected by the resident. The wine will be subject to taxes in the same manner as wine sold directly by the board. The wine will not be released by the State store until all moneys due, including all taxes and fees, have been paid by the resident.
(f) A person shall sign an affidavit provided by the Pennsylvania Liquor Store where the wine was delivered to stating that the wine will only be used for the person's personal use. Any person who resells wine obtained under this section commits a misdemeanor of the second degree.
(g) The board may promulgate such rules and regulations as are necessary to implement and enforce the provisions of this section. The board may charge the resident a fee to cover the cost associated with processing the Internet order.
(h) The board shall submit monthly reports to the Appropriations Committee and the Law and Justice Committee of the Senate and to the Appropriations Committee and the Liquor Control Committee of the House of Representatives summarizing the number of direct shipper licenses issued by the board, the quantity of wine sold pursuant to this section and the total dollar value of sales under this section.
(i) The term "wine" as used in this section shall mean liquor which is fermented from grapes and other fruits, having alcoholic content of twenty-four per centum or less. The term "wine" shall not include malt or brewed beverages nor shall wine include any products containing alcohol derived from malt, grain, cereal, molasses or cactus.
Here is the exception for Pa Wine that is NOW unconstitutional under this ruling. Through the PLCB legal opinion may save this section by ruling that this section now extends to out of state wineries.
§ 5-505.2. Limited wineries
(a) In the interest of promoting tourism and recreational development in Pennsylvania, holders of a limited winery license may:
(1) Produce alcoholic ciders, wines and wine coolers, subject to the exceptions provided under this section, only from an agricultural commodity grown in Pennsylvania.
(2) Sell alcoholic cider, wine and wine coolers produced by the limited winery or purchased in bulk in bond from another Pennsylvania limited winery on the licensed premises, under such conditions and regulations as the board may enforce, to the board, to individuals and to brewery, hotel, restaurant, club and public service liquor licensees, and to Pennsylvania winery licensees: Provided, That a limited winery shall not, in any calendar year, purchase alcoholic cider or wine produced by other limited wineries in an amount in excess of fifty per centum of the alcoholic cider or wine produced by the purchasing limited winery in the preceding calendar year. In addition, the holder of a limited winery license may purchase wine in bottles from another Pennsylvania limited winery if these wines undergo a second fermentation process. Such wine may be sold in bottles bearing the purchasing limited winery's label or the producing limited winery's label. Such wines, if sold by the board, may be sold by the producing limited winery to the purchasing limited winery at a price lower than the price charged by the board.
(3) Separately or in conjunction with other limited wineries, sell alcoholic cider, wine and wine coolers produced by the limited winery on no more than five (5) board-approved locations other than the licensed premises, with no bottling or production requirement at those additional board-approved locations and under such conditions and regulations as the board may enforce, to the board, to individuals and to brewery, hotel, restaurant, club and public service liquor licensees. If two or more limited wineries apply to operate an additional board-approved location in conjunction with each other, the wineries need only have one board-approved manager for the location, need only pay one application fee and need not designate specific or distinct areas for each winery's licensed area. Each limited winery must file an application for such an additional board-approved location, and such location shall count as one of the five permitted for each limited winery. Each limited winery is responsible for keeping only its own complete records. A limited winery may be cited for a violation of the recordkeeping requirements of sections 512 and 513 pertaining to its own records only.
(4) At the discretion of the board, obtain a special permit to participate in alcoholic cider, wine and food expositions off the licensed premises. A special permit shall be issued upon proper application and payment of a fee of thirty dollars ($ 30) per day for each day of permitted use, not to exceed five (5) consecutive days. The total number of days for all the special permits may not exceed forty (40) days in any calendar year. A special permit shall entitle the holder to engage in the sale by the glass, by the bottle or in case lots of alcoholic cider or wine produced by the permittee under the authority of a limited winery license. Holders of special permits may provide tasting samples of wines in individual portions not to exceed one fluid ounce. Samples at alcoholic cider, wine and food expositions may be sold or offered free of charge. Except as provided herein, limited wineries utilizing special permits shall be governed by all applicable provisions of this act as well as by all applicable regulations or conditions adopted by the board.
For the purposes of this clause, "alcoholic cider, wine and food expositions" are defined as affairs held indoors or outdoors with the primary intent of educating those in attendance of the availability, nature and quality of Pennsylvania-produced alcoholic ciders and wines in conjunction with suitable food displays, demonstrations and sales. Alcoholic cider, wine and food expositions may also include activities other than alcoholic cider, wine and food displays, including arts and crafts, musical activities, cultural exhibits, agricultural exhibits and similar activities.
(5) Apply for and hold a hotel liquor license, a restaurant liquor license or a malt and brewed beverages retail license to sell for consumption at the restaurant or limited winery on the licensed winery premises, liquor, wine and malt or brewed beverages regardless of the place of manufacture under the same conditions and regulations as any other hotel liquor license, restaurant liquor license or malt and brewed beverages retail license.
(6) (i) Secure a permit from the board to allow the holder of a limited winery license to use up to twenty-five per centum permitted fruit, not wine, in the current year's production. Each permit is valid only for the calendar year in which it is issued.
(ii) The fee for a permit to import and use permitted fruit shall be in an amount to be determined by the board.
(iii) The purpose of this section is to increase the productivity of limited wineries while at the same time protecting the integrity and unique characteristics of wine produced from fruit primarily grown in this Commonwealth. Prevailing climatic conditions have a significant impact on the character of the fruit. Accordingly, "permitted fruit" shall mean fruit grown or juice derived from fruit grown within three hundred fifty (350) miles of the winery.
(iv) The department is authorized to promulgate regulations requiring the filing of periodic reports by limited wineries to ensure compliance with the provisions of this section.
(6.1) Sell food for consumption on or off the licensed premises and sell by the glass only wine and alcoholic ciders that may otherwise be sold by the bottle.
(6.2) Sell wine- or liquor-scented candles acquired or produced by the limited winery.
(6.3) Sell alcoholic cider, wine and wine coolers only between the hours of nine o'clock antemeridian and nine o'oclock postmeridian. During the period from Thanksgiving Day through New Year's Day, limited winery sales locations may remain open to conform with the closing times of neighboring mall or shopping district businesses but no later than ten o' clock postmeridian. A limited winery also may request approval from the board to extend sales hours in individual locations at other times during the year or beyond the limits set forth in this clause. The request shall be made in writing to the board's Office of the Chief Counsel and shall detail the exact locations where sales hours are proposed to be extended, the proposed hours and dates of extended operation and the reason for the proposed extended hours.
(b) The total production of alcoholic ciders, wine and wine coolers by a limited winery may not exceed two hundred thousand (200,000) gallons per year.
(c) The term "agricultural commodity" as used in this section shall include any of the following: agricultural, apicultural, horticultural, silvicultural and viticultural commodities.
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