Wine lovers sue for right to buy from out of state

PHOENIX - Some Arizona residents are going to court to make theworld a little nicer - and a little less expensive - forconnoisseurs of boutique wines.

The wine lovers, including a former official in the Reaganadministration, are asking U.S. District Court Judge Earl Carroll tovoid a law that makes it illegal for Arizonans to order winedirectly from out-of-state wineries. Right now, they either have togo to the wineries themselves or arrange to have the wine shippedthrough Arizona wholesalers and retailers, who tack on their ownprofit.

The law, however, exempts Arizona wineries. The lawsuit contendsthe exemption runs afoul of the U.S. Constitution, which precludesstates from imposing restrictions on interstate commerce.

Phil MacDonnell, who represents beer and wine distributors, saidthe current system makes sense because it ensures that Arizonacollects state luxury taxes on wine shipped into the state.

But Phoenix resident John R. Norton, who served as undersecretaryof agriculture under President Reagan, said the law hurts Arizonanswho want specialty wines that are not sold here. He said the statuteis designed solely to protect the profits of the liquor industry.

No store in Arizona stocks the Virginia-produced wine Nortondrinks and the small winery has no arrangement with an Arizonawholesaler to send it to him.

Arizona law generally allows sales of wine to consumers only bylicensed retailers. And the statutes have set up a three-tieredsystem of manufacturers, wholesalers and retailers, withrestrictions that limit any company to only one of those tiers.

But state lawmakers made an exception for Arizona wineries tohelp them sell their products directly to consumers. Clint Bolick,an attorney for the Institute for Justice, which filed the suit,said that allows those wineries to take direct phone, fax andInternet orders for wine.

The law, however, says consumers who want wines that are not soldhave two choices: Either go directly to the winery to place an orderor arrange for the winery to ship it through Arizona wholesalers andretailers.

Bolick said the first option makes little sense as it forcesArizonans to travel out of state. He also noted there is a limit ofonly two cases of wine per consumers. The second option, he said,can add about a third to the cost of the wine.

But the system helps protect against minors ordering wine,MacDonnell said.

Bolick responded that 26 other states allow interstate shipmentswithout apparent problems. Anyway, he said, there are far easierways for minors to get alcohol than buying expensive boutique wines.

Arizona lawmakers have kept the system in place for a reason,Norton said: "The liquor wholesalers; have bought and paid for theArizona Legislature since the end of Prohibition."