Minnesota Winery Internet Speech - Background

Litigation Backgrounder

Challenging Minnesota’s Advertising and Internet Speech Ban That Bottles Up Wineries and Consumers

In a Nutshell

In a set of regulations out of step with the Internet Age, the State of Minnesota delivers a one-two punch to the growing wine business, particularly Minnesota’s own budding industry, and hinders Minnesota consumers who enjoy various vintages from across the nation.

First, the State bans all wineries (even those out of state) from accepting online orders.  Instead, Minnesota wine consumers must log off their computers and then call a winery (or fax, send postal mail or visit in person) to place an order.  Second, the State prohibits wineries from advertising the fact that they can send their product directly to customers.  It’s legal to advertise the wine—just not that customers can have it shipped directly to their homes.

Minnesota liquor stores, however, may sell wine—even the exact same wines—from the convenience of their websites.  And they are free to advertise their direct shipping services.

These regulations severely restrict the two most effective ways small wineries have of growing their businesses:  e-commerce and direct shipping services to distant customers.  The law also keeps consumers from learning about perfectly legal products they might wish to buy and from ordering those products in the way they choose.

To protect their free speech rights to communicate—and hear—truthful information through the medium of their choice, Fieldstone Vineyards of Minnesota, White Winter Winery of Wisconsin and Minnesota consumer Kim Crockett joined with the Institute for Justice Minnesota Chapter (IJ-MN) to challenge Minnesota’s senseless regulations.  On October 12, 2005, IJ-MN filed a lawsuit asking the U.S. District Court for the State of Minnesota to strike down Minnesota’s advertising and Internet speech ban as a violation of the First Amendment and the right to equal protection of the law under the 14th Amendment.

The Institute for Justice has a long history of successfully defending free speech and protecting the free flow of information essential to informed decision-making in both politics and commerce.

Introduction

If you live in Minnesota and enjoy surfing the web to find unique wines from small vintners, stop surfing: you are banned from legally buying your wine from a winery’s website. In a bizarre regulation for the Internet Age, Minnesota bans all wineries (even those out of state) from accepting online orders.[1] Instead of consumers being able to point, click and buy, Minnesota law requires its citizens to log off and call up a winery (or fax, send postal mail or, even more difficult, visit in person) to place an order.

 Just as ridiculous, the State of Minnesota bans wineries from advertising a service critical to their business: the fact that they can send their product directly to customers. It’s legal to advertise the wine—just not that it can be directly shipped to a customer’s home.[2]

At the same time that wineries are muzzled, however, the Minnesota Department of Public Safety allows liquor stores to sell the exact same wines from the convenience of their websites. And they are free to advertise their direct shipping services.[3]

Minnesota says to wineries: you can legally make your product, sell it and deliver it directly to customers at home—you just can’t tell consumers it can be delivered, or allow them to order it in the easiest way possible, over the Internet. This advertising and Internet speech ban is backed by the threat of criminal prosecution, fines and jail time.[4]

Minnesota’s senseless advertising and Internet speech ban not only runs afoul of the First Amendment, trampling the free speech rights of both small wineries and consumers, it stifles entrepreneurship in an industry that’s growing both in Minnesota and nationwide—and for which Internet communication and sales are absolutely vital.

            The unfortunate victims of Minnesota’s advertising and Internet speech ban are small wineries, like Fieldstone Vineyards of Morgan, Minn., and White Winter Winery of Iron River, Wis. Like most small wineries, both are hundreds of miles from major cities and neither can afford to rely on in-person orders to build a customer base. Direct shipment of wine to distant consumers is essential to their growth and stability. But Minnesota’s speech and Internet restrictions put the wineries at a major economic disadvantage.

“The key to our success is letting our customers in Minnesota know they have access to our product from the convenience of their own home,” said Jon Hamilton, vice president of White Winter Winery.

Charlie Quast, co-owner of Fieldstone Vineyards asked, “Are we just supposed to ignore the fact our website gets 2,000 page views per month?”

Minnesota’s advertising and Internet speech ban also tramples the free speech rights of consumers—like wine enthusiast Kim Crockett of Deephaven, Minn.—who want nothing more than to receive information about how to order products they want and to order them in the way they choose. Crockett said the ban “makes no sense because we’re talking about getting a legal product delivered in a perfectly legal way.

That’s why Fieldstone Vineyards, White Winter Winery and consumer Kim Crockett joined with the Institute for Justice Minnesota Chapter (IJ-MN) to challenge Minnesota’s ban on speech about direct shipping services and on online sales. On October 12, 2005, IJ-MN filed a lawsuit asking the U.S. District Court for the State of Minnesota to strike down Minnesota’s advertising and Internet speech ban as a violation of the First Amendment and the right to equal protection of the law under the 14th Amendment.

Winemaking Grows in Popularity and Profitability

Today, there are more than 3,000 wineries in the United States, “more than three times the number 30 years ago.”[5] In fact, “[f]rom 1994 to 1999, consumer spending on direct wine shipments doubled, reaching $500 million per year, or three percent of all wine sales.”[6] Increasingly, farmers have recognized that growing grapes and making wine are an alternative to traditional crops for family farms—gross revenue from wine making is estimated by Don Reding of Fieldstone Vineyards at $2,500 per acre, far greater than the $300 per acre for growing soybeans, corn and other traditional crops.

The Midwest, and Minnesota in particular, is no exception to the nationwide upsurge in winemaking and the growing popularity of vintages from small vintners. Minnesota’s first winery, Alexis Bailly Vineyard, opened in 1978 with wines produced from 100 percent Minnesota-grown grapes. There are now 19 wineries in Minnesota, 12 of which produce wines from grapes such as Maréchal Foch, a rich, red wine grape developed in Alsace that is among the most widely planted grapes in the Upper Midwest; Frontenac, the first of the University of Minnesota’s line of “cold hardy” grapevines; and Saint Croix, a grape that produces a medium-bodied red wine. The other seven Minnesota wineries craft wines from fruit as varied as rhubarb, blueberry, strawberry, raspberry, sumac and chokecherry.[7]

Regional winery owners attribute the industry’s genesis to the late Elmer Swenson, who worked for the State of Minnesota and is considered the founding father of Minnesota and Wisconsin viticulture, and ongoing research by the University of Minnesota. The University of Minnesota has become a leading developer of hybrid grapes and its Horticultural Research Center annually produces thousands of new grape seedlings. The seedlings are planted in vineyards and evaluated over time for viticultural traits, such as cluster size, early ripening and, of course, cold hardiness. In essence, the State of Minnesota has spent and continues to spend taxpayer money to develop and promote the region’s cold-weather wineries—but it prohibits those wineries from promoting themselves.

Fieldstone Vineyards and White Winter Winery are typical of wineries in the Upper Midwest that take advantage of unique climate and soil conditions to create specialized varieties of wine. Located on a small, family-run farm in Morgan, Minn., 115 miles southwest of the Twin Cities, Fieldstone Vineyards (www.fieldstonevineyards.com) was started by Don Reding, his son Chad and his son-in-law Charlie Quast. Since Don’s grandfather founded the farm in 1901, the Redings have mainly raised livestock and grown crops such as soybeans and corn. It wasn’t until the 1990s that Don’s son-in-law, Charlie Quast, persuaded the family to grow wine grapes and start a winery. Together the Redings and Charlie convinced the State of Minnesota to research growing cold-hardy grapes at the family farm.

In 1999, Fieldstone received a grant from the State of Minnesota’s Energy and Sustainable Agriculture Program. The following year, Don, Chad and Charlie pooled their resources and planted 256 nursery stock vines of five different winter-hardy grapes (such grapes can survive to 35 degrees below zero) on approximately two-thirds of an acre. In a stunning success, 238 vines survived the winter without any protection. According to Don Reding, the 93 percent success rate “proved grapes could be an alternative crop to sustain the family farm in Minnesota.”

Charlie, Don and Chad then joined forces with wine enthusiast Mark Wedge, a self-taught winemaker whose skills include counteracting the great fertility of southern Minnesota’s farmland in order to slow and strengthen the growth of the vines. Together, they opened a tasting room and retail outlet in spring 2003.

In 2005, Fieldstone will complete its fourth harvest and the winery will produce more than 10,000 bottles of various wines. Its successful research and continuing testing have allowed Fieldstone to dedicate about three acres to growing grapes. The yield of the additional acreage provides the winery with approximately 25 percent of its needs. Other vineyards in Minnesota, Wisconsin and elsewhere supply the remaining 75 percent. Such diversification in grape supplies is a common practice to minimize agricultural risks inherent in sourcing grapes from only one location.

By contrast to Fieldstone’s grape product, White Winter Winery (www.whitewinterwinery.com) specializes in the crafting of mead wines—an ancient form of wine made with the addition of honey and the option of fresh fruit, like strawberries, blueberries and apples. Jon and Kim Hamilton founded White Winter in 1996, after years of amateur winemaking and backyard beekeeping. Located in Iron River, Wis., 40 miles east of Duluth, White Winter sits near a unique 12-square-mile micro-climate on the shores of Lake Superior that allows for long, cool nights and warm days extending the growing season by several weeks. It is also a prime location for honey production, with an abundance of such flowers as Dutch white clover, which yields a pollen that results in sweet, light honey—the perfect ingredient for mead.

One of White Winter’s founding objectives is to help develop a sustainable rural economy in the region. To do so, Jon and Kim Hamilton purchase fruit, honey and most other ingredients from nearby producers in rural Wisconsin and Minnesota. Using local ingredients, White Winter produces around 50,000 bottles of mead annually.

 

Direct Shipping, Marketing and Internet Are Vital to Growth of Small Wineries

Direct shipping to consumers is especially valuable to small wineries that have difficulties convincing wholesalers and retailers to devote time or shelf space to their products. Small wineries typically do not produce enough volume to be economical for wholesalers and retailers to carry their wines. The importance of direct shipping is further increased by the decline in the number of wholesalers (600 in 2002 down from 1,600 in 1984)[8] available to introduce the wineries’ products into new and distant markets. To realize the benefits of direct shipping, however, wineries must be able to advertise and solicit specific consumers about their direct-shipping services—online, by mail and in the traditional media.

Increasingly, small wineries across the nation are doing just that. The Wall Street Journal recently reported that some vintners are offering special discounts to grow their mail-order businesses. The New York Wine and Grape Foundation is planning a marketing push around a new online directory that will connect consumers with winery websites to purchase wine for direct shipping. In a further sign that direct sales are taking off, the Journal reports that shippers such as FedEx and UPS are beginning their own marketing campaigns, “jockeying with one another for the business.” [9]

In addition to access to distant consumers, the Journal notes the economic benefits to wineries of direct shipping: “Winemakers reap much greater profits from direct sales to consumers because they don’t have to pay wholesalers, whose take is generally at least half of the retail price.”[10]

Minnesota’s laws restricting speech about direct shipping and prohibiting Internet orders thus create a significant obstacle to the growth of regional wineries like Fieldstone and White Winter. Wineries like Fieldstone and White Winter are just too far from major metropolitan areas to rely solely on in-person visits to grow their customer base. Although Fieldstone and White Winter have occasionally found distributors willing to carry their product, they are too small to effectively and consistently engage third-party distributors. Except for a few wineries near Stillwater, Minn., all of the region’s wineries face the same distribution challenges because they are small and located in rural towns.

Charlie Quast and Jon Hamilton also point out that Internet sales and direct shipping enable them to sell their wines free from mark-ups by wholesalers and retailers. Avoiding these mark-ups provides wineries with funds that are critical to expanding their businesses. Moreover, small wineries are often unable to afford large-scale distribution systems, but with the Internet they can market and sell products that would have otherwise been unknown or unavailable. Banning such Internet communications and sales threatens perhaps the most vital distribution channel for small, rural wineries like Fieldstone and White Winter.

“The demand for Minnesota wine is there,” said Charlie Quast. The only question is, “Will the State let us grow our business?” To grow, Fieldstone needs to “reach beyond Morgan, to all parts of Minnesota, Iowa, Wisconsin and Illinois.” But this “can’t be done without promoting Internet sales and direct shipping,” said Quast.

Jon Hamilton agreed that because of White Winter’s distance from major cities, “We have to let people know we can direct ship.” Equally important, he said, is the “Internet’s role in addressing our seasonal needs” by allowing for sales during the winter season when there is almost no foot traffic in Wisconsin’s Northwoods.

 

Minnesota Opens One Door, But Keeps Another Close

In a landmark victory for free trade, small wineries and wine lovers litigated by the Institute for Justice, the U.S. Supreme Court in 2005 struck down protectionist state laws in Michigan and New York that forbade the direct shipment of wine across state lines.[11] Following the ruling, more states began to open their doors to direct shipping of wine. Now, 30 states and the District of Columbia allow wineries to sell wine directly to consumers.[12]

The ruling also prompted Minnesota to open its doors wider to the direct shipment of wine. In June 2005, Gov. Tim Pawlenty signed legislation allowing in-state wineries to ship directly to consumers across the country and freeing Minnesota wine lovers to order from their favorite wineries, wherever they may be.[13]

            Unfortunately, as Minnesota tore down one barrier to free trade, it let stand another: the advertising and Internet speech ban. Minnesota law states:

No person may (1) advertise shipments authorized under this section, (2) by advertisement or otherwise, solicit shipments authorized by this section, or (3) accept orders for shipments authorized by this section by use of the Internet.[14]

This means a winery is prohibited from buying a newspaper advertisement stating that its wine is available for direct purchase and shipping. It is similarly illegal for a winery to buy radio or television time advertising direct shipping, or even to hand-out brochures or send postcard solicitations for direct shipping to long-time customers. In this way, Minnesota prohibits the free speech of wineries.

Additionally, wineries are prohibited from accepting a customer order online for direct shipping. If a consumer like Kim Crockett wishes to purchase the wine she just saw on White Winter’s website, she must put down her mouse, pick up her phone and place a call, hoping that White Winter maintains convenient customer service hours.

Minnesota law thereby freezes wineries like White Winter and Fieldstone out of the cost savings afforded by Internet communication by forcing them to exchange information with customers through more cumbersome means that require customer service staffing.

            Bizarrely, at the same time that the government stifles the Internet speech of Fieldstone and White Winter, the Department of Public Safety permits licensed retailers to freely communicate via the Internet to sell wine online and to advertise their direct shipping services.[15] This double standard means, for instance, the corner liquor store is free to accept Kim Crockett’s online order of White Winter blueberry mead or Fieldstone Glacial Rock Red for direct shipment to her door, but White Winter and Fieldstone themselves cannot accept the same order. Minnesota thus unfairly prefers the Internet speech rights of the corner liquor store to that of the small, rural winery that actually produces the product in the first place.

Wineries cannot disregard Minnesota’s advertising and Internet speech ban without peril. Repeat violations subject winemakers to misdemeanor or gross misdemeanor criminal charges, including the possibility of fines amounting to $3,000 per occurrence and prison sentences as long as one year in jail.[16]

 

The Legal Battle for Free Speech

Minnesota’s advertising and Internet speech ban not only stifles the free flow of information necessary for a market economy, it is a naked affront to constitutional law interpreting the First and 14th Amendments. As the U.S. Supreme Court held nearly 30 years ago in Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, “It is a matter of public interest that [economic] decisions in the aggregate be intelligent and well-informed. To this end, the free flow of commercial information is indispensable.”[17]

Following such well-settled precedent, the lawsuit filed by Fieldstone Vineyards, White Winter Winery and Kim Crockett challenges the constitutionality of Minnesota’s prohibition on advertisements and solicitations regarding a lawful commercial transaction—the direct sale and shipment of wine by wineries to their customers—as well as its needless singling out of the Internet as the sole banned medium for accepting orders. The lawsuit also challenges Minnesota’s unconstitutional double standard that allows liquor stores to freely communicate via the Internet to sell wine online and to advertise their direct shipping services.

 

The First Amendment Right to Advertise and Solicit the Sale of Wine

In Central Hudson Gas & Elec. Corp. v. Public Serv. Comm’n of N.Y.,[18] the U.S. Supreme Court set forth a test governing restrictions on speech that relates to a commercial transaction. Restrictions on non-misleading speech concerning a lawful commercial activity are valid only if they (1) involve a substantial governmental interest, (2) directly advance that interest, and (3) are not more extensive than necessary in serving that interest.[19]

Based on the “Central Hudson test,” the Court recently struck down prohibitions on advertisements and solicitations of controlled substances in Thompson v. Western States Medical Center. [20] Specifically, the Court held that pharmacists were entitled under the First Amendment to advertise and solicit prescriptions for “compound drugs”—drugs that are not approved by the FDA, but which are created by mixing, combining or altering ingredients of FDA-approved medications. In so doing, the Court reaffirmed the proposition that “communication that does no more than propose a commercial transaction is entitled to the coverage of the First Amendment.”[21]

More specific to alcohol advertising, in 44 Liquormart, Inc. v. Rhode Island,[22] the Court stated: “We conclude a state does not have broad discretion to suppress truthful, nonmisleading information for paternalistic purposes.”[23] The Court continued:

[A] State’s regulation of the sale of goods differs in kind from a State’s regulation of accurate information about those goods. The distinction that our cases have consistently drawn between these two types of governmental action is fundamentally incompatible with the absolutist view that the State may ban commercial speech simply because it may constitutionally prohibit the underlying conduct.[24]

            44 Liquormart involved a government-imposed ban on advertising the price of liquor. The State asserted that the ban was justified as a measure to promote its substantial interest in temperance, maintaining that a ban on price advertising would reduce competition, thereby increasing prices while decreasing consumption.[25] The Court struck down the ban unanimously, concluding that it failed constitutional muster because it did not sufficiently advance the State’s interest in promoting temperance and that the ban was more extensive than necessary in achieving that interest.[26]

44 Liquormart contains powerful language that condemns Minnesota’s Advertising and Internet speech ban. The Court expressed skepticism of “blanket bans” on commercial speech “‘unless the expression itself was flawed in some way, either because it was deceptive or related to unlawful activity.’”[27] The Court reasoned, “bans that target truthful, nonmisleading commercial messages rarely protect consumers from such harms. Instead, such bans often serve only to obscure an underlying governmental policy that could be implemented without regulating speech.”[28]

As recently as last year, the 2nd U.S. Circuit Court of Appeals applied 44 Liquormart to strike down a speech prohibition that almost exactly mirrors Minnesota’s Advertising and Internet speech ban. Specifically, in Swedenburg v. Kelly,[29] the court of appeals considered a constitutional challenge to a New York statute that provided:

No person shall send or cause to be sent into the state any ... publication of any kind containing an advertisement or a solicitation of any order for any alcoholic beverages.[30]

The 2nd Circuit struck down the foregoing statute as “overbroad,” quoting 44 Liquormart for the proposition that “the Twenty-first Amendment does not qualify the constitutional prohibition against laws abridging the freedom of speech embodied in the First Amendment.”[31]

The 10th U.S. Circuit Court of Appeals also recently struck down an advertising ban affecting the sale of wine.[32] There, the Court of Appeals enjoined the State of Utah from enforcing a statute that prohibited “[t]he advertising or use of any means or media to induce persons to buy liquor” with the exceptions of beer advertising and limited forms of advertising by restaurants and hotels.[33] The court held “Utah’s present scheme of advertising regulation must be considered irrational” because the State failed to show that advertising restrictions promoted temperance, the State failed to demonstrate why wine and liquor advertising should be treated differently than beer advertising, and the State failed to show why its regulatory goals required speech restrictions.[34] The Court concluded by emphasizing that “a ban placing only partial limits on speech is nevertheless subject to the same standard of First Amendment review that would be applied to a complete ban.”[35]

The First Amendment Right to Online Commercial Speech

            In addition to the general right to advertise, the U.S. Supreme Court has long recognized the First Amendment right to engage in speech that does “no more than propose to buy X at Y price.”[36]

            Minnesota’s ban on Internet sales by wineries flies in the face of this basic right to free speech. Direct shipping of wine is legal in Minnesota, and so is buying and selling wine for direct shipment via other media, such as phone and fax. What is illegal is using a particular mode of communication, the Internet, to carry out a legal sale. And, of course, using the Internet for sales is only illegal for certain speakers and not others, as liquor stores are free to sell online while wineries are not.

            Thus, Minnesota’s ban on Internet sales is more than just a ban on a transaction—it’s an unconstitutional ban on speech that prevents a perfectly legal transaction.

The 14th Amendment Right to Equality Among Speakers and Media

Minnesota’s advertising and Internet speech ban also discriminates among speakers by allowing liquor stores, but not wineries, to advertise and solicit direct shipping services and to accept online orders. In addition, Minnesota’s ban on online sales arbitrarily burdens a particular medium—the Internet—while allowing the very same communications and transactions via other media, such as phone, fax, postal mail and in-person visits.

In challenging Minnesota’s law as discriminatory, the Institute for Justice Minnesota Chapter will build on precedent set in another IJ case, ForSaleByOwner.com v. Zinnemann.[37] There, the Institute for Justice mounted a constitutional challenge to California’s requirement that the owners of ForSaleByOwner.com become fully licensed real estate brokers in order to place home sales advertisements on their website and to publish information about the process of selling a home. At the same time, the State exempted newspapers from the very same regulatory regime. The Institute for Justice succeeded in persuading the U.S. District Court for the Eastern District of California that this scheme was unconstitutionally discriminatory. In striking down California’s licensing law, the court held:

Given the uncontroverted fact that [ForSaleByOwner]’s activities are virtually identical to those pursued online by California newspapers, the distinction drawn between the two publishing mediums appears wholly arbitrary. California cannot make arbitrary distinctions based on the manner of speech or the media used for publication.[38]

Minnesota’s double standard favoring the speech and online transactions of liquor stores over that of wineries is precisely the kind of speaker and media discrimination struck down in ForSaleByOwner.com.

Minnesota cannot deprive wineries of the cost savings of the Internet by unequally forcing them to use exclusively traditional telephonic, mail, fax or in-person communications, rather than their Internet Service Provider or website hosting service.[39]

Reinforcing and Expanding Free Speech

This lawsuit is the initial step in the Institute for Justice Minnesota Chapter’s campaign to reinforce and expand the U.S. Supreme Court’s recognition that “the free flow of commercial information is indispensable” to a free society. [40] In addition to preserving the protection of the traditional media, IJ-MN’s goal is to ensure that the Internet is not forgotten when the courts enforce existing free speech protections.

The Institute for Justice litigates in support of fundamental individual liberties, including freedom to engage in commercial speech. IJ’s headquarters and state chapters have scored significant victories on behalf of individuals and businesses throughout the nation. A few of these important victories include:

1. Swedenburg v. Kelly,[41] where the Institute for Justice persuaded the 2nd U.S. Circuit of Court of Appeals to enforce the First Amendment by striking down a prohibition on advertisements and solicitation for alcoholic beverages by anyone other than licensed retailers.

2. ForSaleByOwner.com Corp. v. Zinnemann,[42] where the Institute for Justice prevailed in persuading the U.S. District Court for the Eastern District of California to enforce the First Amendment by striking down the State of California’s attempt to impose real estate broker licensing requirements on an informational website.

3. Battaglieri v. Mackinac Center For Public Policy,[43] where the Institute for Justice successfully defended on First Amendment grounds an invasion of privacy claim against a public policy research institute that accurately quoted a representative of the Michigan Educational Association in a letter to supporters.

4. Wexler v. City of New Orleans,[44] where the Institute for Justice persuaded the U.S. District Court for the Eastern District of Louisiana to enforce the First Amendment by striking down an ordinance that prohibited booksellers from selling books on city sidewalks without a permit.

5. Taucher v. Born,[45] where the Institute for Justice persuaded the U.S. District Court for the District of Columbia to enforce the First Amendment by striking down a regulation issued by the Commodity Futures Trading Commission that would have required publishers of financial newsletters and Internet websites to register as commodity trading advisors.

Litigation Team

The attorneys in Crockett v. Minnesota Department of Public Safety are Institute for Justice Minnesota Chapter Executive Director Lee McGrath and Staff Attorney Nick Dranias.

The Institute for Justice is a nonpartisan, nonprofit public interest law firm that advances a rule of law under which individuals can control their destinies as free and responsible members of civil society. Through strategic litigation, training, communication and outreach, the Institute secures greater protection for individual liberty and illustrates and extends the benefits of freedom to those whose full enjoyment is denied by the government.

Formed in 1991, this national organization trains law students, lawyers and others in the strategies of public interest litigation with the goal of limiting governmental power and advancing individual freedom in civil society.

Headquartered in Washington, D.C., the Institute for Justice has state chapters in Arizona, Washington state and Minnesota. IJ-MN was established in April 2005.

From its office in Minneapolis, the Institute for Justice Minnesota Chapter litigates under the state and federal constitutions to reinvigorate economic liberty, preserve property rights, promote educational choice and defend the free flow of information essential to informed choices in both politics and commerce.

For more information contact:

Lisa Knepper
Director of Communications
lknepper@ij.org
(703) 682-9320 x202                                     

Lee McGrath, Executive Director
Institute for Justice Minnesota Chapter
527 Marquette Avenue-Suite 1600
Minneapolis, MN 55402-1330
lmcgrath@ij.org
(612) 435-3451



[1] Minn. Stat. § 340A.417(c)(3) (West 2005).

[2] Id. § 340A.417(c)(1) and (2).

[3] Minn. R. 7515.0580 (West 2005); See, e.g., Chicago-Lake Liquors: Find York Liquor, http://www.chicagolakeliquors.com/views/ findYourLiquor.php?search=keyword&keyword=absolut (last visited September 13, 2005); Simon Delivers: Wine & Spirits Store, http://www.simondelivers.com/default.asp (last visited September 13, 2005).

[4] Id. § 340A.417 (e), (f), and (g) (stating two or more violations within the same two-year period can subject the offender to misdemeanor or gross misdemeanor criminal charges).

[5] Granholm v. Heald, 125 S.Ct. 1885, 1892 (2005).

[6] Id.

[7] Such fruit wines are regulated under the same legal regime as grape wines.

[8] Granholm, 125 S.Ct. at 1892.

[9] Vanessa O’Connell, The Pinot Noir Is In the Mail: Removal of Shipping Bans Spurs Surge in Wine Orders; How to Get Cult Cabernets, Wall Street Journal, Sept. 22, 2005, at D1.

[10] Id.

[11] Granholm at 1893, et seq.

[12] Vanessa O’Connell, The Pinot Noir Is In the Mail: Removal of Shipping Bans Spurs Surge in Wine Orders; How to Get Cult Cabernets, Wall Street Journal, Sept. 22, 2005, at D1.

[13] Minn. Stat. § 340A.417(a) and (b) (West 2005). State law requires in-state and out-of-state wineries to comply with regulations prohibiting and safeguarding against the sale of alcohol to minors.

[14] Minn. Stat. § 340A.417(c) (West 2005).

[15] Minn. R. 7515.0580 (West 2005); see supra n. 7.

[16] Minn. Stat. § 340A.417(e), (f) and (g) (stating two or more violations within the same two-year period can subject the offender to misdemeanor or gross misdemeanor criminal charges).

[17] 425 U.S. 748, 764-65 (1976).

[18] 447 U.S. 557 (1980).

[19] Id. at 566.

[20] Thompson v. Western States Medical Center, 535 U.S. 357 (2002).

[21] Id. at 367 (quoting Edenfield v. Fane, 507 U.S. 761, 767 (1993)).

[22] 517 U.S. 484 (1996).

[23] Id. at 510.

[24] Id. at 512.

[25] Id. at 530 (O’Connor, J., concurring).

[26] Id. at 505-08.

[27] Id. at 500 (quoting Central Hudson, 447 U.S. at 566).

[28] Id. at 502-03 (internal quotation marks and footnote omitted).

[29] Swedenburg v. Kelly, 358 F.3d 223, 240-41 (2nd Cir. 2004).

[30] Id. at 240-41.

[31] Id. at 240-41 (citations omitted).

[32] Utah v. Leavitt, 256 F.3d 1061 (10th Cir. 2001).

[33] Id. at 1068.

[34] Id. at 1074-75.

[35] Id. at 1075 n.5.

[36] Virginia State Bd., 425 U.S. at 761.

[37] 347 F. Supp. 2d 868 (E.D. Cal. 2004).

[38] Id. at 877.

[39] The Pitt News v. Pappert, 379 F.3d 96, 102-03 (3rd Cir. 2004) (holding law preventing alcoholic beverage advertisers from running paid ads in media affiliated with educational institutions was unconstitutional because the law singled out particular segments of the media without adequate justification, stating “the Supreme Court recognized long ago that laws that impose special financial burdens on the media or a narrow sector of the media present a threat to the First Amendment”) (citing Grosjean v. Am. Press Co., 297 U.S. 233 (1936), Minneapolis Star & Tribune Co. v. Minnesota Comm’r of Revenue, 460 U.S. 575 (1983), and Arkansas Writers’ Project, Inc. v. Ragland, 481 U.S. 221 (1987)).

[40] Id at 765.

[41] 358 F.3d 223 (2nd Cir. 2004).

[42] 347 F. Supp. 2d 868 (E.D. Cal. 2004).

[43] 680 N.W.2d 915 (Mich. Ct. App. 2004).

[44] 267 F.Supp.2d 559 (E.D. La. 2003).

[45] 53 F.Supp.2d 464 (D.D.C. 1999).


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