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appealmotionregulationjudicial review
statuteappealappellantappellee

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Brown-Forman Distillers Corp. v. New York State Liquor Authority, 476 U.S. 573, 106 S.Ct. 2080, 90 L.Ed.2d 552, 54 USLW 4567

Facts

Brown-Forman Distillers Corp. is a distiller that sells liquor in New York and other states. The New York Alcoholic Beverage Control Law requires distillers to sell at prices no higher than the lowest prices charged elsewhere in the U.S. Brown-Forman offered promotional allowances to wholesalers, which the Liquor Authority determined violated the law. After the Authority initiated license revocation proceedings, Brown-Forman sought judicial review, arguing that the law was unconstitutional and arbitrary.

Appellant Brown-Forman Distillers Corp. (Brown-Forman) is a distiller that owns several brands of liquor that it sells in New York and in other States.

Issue

Does New York's Alcoholic Beverage Control Law, which requires distillers to affirm that their prices in New York are no higher than those charged elsewhere, violate the Commerce Clause of the Constitution?

The issue in this case is whether that requirement violates the Commerce Clause of the Constitution.

Rule

The Commerce Clause prohibits states from enacting laws that directly regulate or discriminate against interstate commerce, and the Twenty-first Amendment does not grant states the authority to regulate sales in other states.

The affirmation provision of New York's ABC Law, on its face, violates the Commerce Clause.

Analysis

The U.S. Supreme Court found that New York's affirmation provision directly regulated out-of-state transactions by requiring distillers to maintain price parity across states. This regulation effectively forced distillers to seek approval from New York before adjusting prices in other states, which constitutes a direct regulation of interstate commerce. The Court also noted that the Twenty-first Amendment does not provide a shield for such regulations that affect sales in other states.

Once a distiller's posted price is in effect in New York, it must seek appellee's approval before it may lower its prices for the same item in other States.

Conclusion

The U.S. Supreme Court reversed the New York Court of Appeals' decision, ruling that the affirmation provision of the ABC Law violates the Commerce Clause and is not saved by the Twenty-first Amendment.

Having found that the ABC Law on its face violates the Commerce Clause, and is not a valid exercise of New York's powers under the Twenty-first Amendment, we reverse the judgment of the New York Court of Appeals.

Who won?

Brown-Forman Distillers Corp. prevailed because the U.S. Supreme Court found that New York's law unconstitutionally regulated interstate commerce.

The U.S. Supreme Court ultimately reversed, holding that the statute violated the Commerce Clause and was not a valid exercise of New York's powers under the Twenty-first Amendment.

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