On Monday the Supreme Court addressed—or, perhaps more to the point, chose not to address—an issue close to the hearts of many in the midst of a pandemic: home delivery of fine wine and spirits. The Court declined to review the Sixth Circuit’s decision in Lebamoff v. Whitmer, which upheld the State of Michigan’s alcohol delivery laws in the face of a dormant Commerce Clause challenge.
Like many states, Michigan employs a “three-tier system” for alcohol distribution. State-licensed alcohol producers and manufacturers (first tier) sell their products to licensed wholesalers (second tier), who in turn distribute the product to licensed retailers (third tier). Participants in each tier are heavily regulated by the State, which retains the authority to impose price controls, taxes, and other health-and-safety regulations. By requiring all alcohol entering the State to pass through this three-tier system, Michigan ultimately controls the amount of alcohol sold within its borders.
In 2016 Michigan enacted a statute permitting licensed retailers (the third tier) to offer home delivery. While consumers undoubtedly welcomed this development (particularly on those harsh winter weekends when they were facing—and losing to—the Ohio State Buckeyes), retailers in neighboring states apparently were not impressed. An Indiana retailer, Lebamoff Enterprises, sued the State, arguing that the statute violated the dormant Commerce Clause by allowing in-state—but not out-of-state—retailers to deliver alcohol to Michigan residents.
The Sixth Circuit rejected Lebamoff’s argument this past April, holding that the statute was a valid exercise of the State’s authority to regulate the importation of alcohol under the Twenty-first Amendment. Continue Reading