Family Winemakers of CA. vs. Jenkins, 592

1. Conclusion

1.1. Ruling: federal district court agreed and issued an injunction to prevent enforcement of the statute. Massachusetts appealed.

1.2. It was concluded that Massachusetts altered the competitive balance to favor Massachusetts's wineries and disfavor out-of-state competition by design.

1.3. Massachusetts therefore bears the heavy burden of showing that the statute is nonetheless constitutional because it serves a legitimate local purpose that cannot be attained through reasonable non-discriminatory alternatives. The state can only carry this burden by presenting “concrete record evidence,” and not “sweeping assertion[s]” or “mere speculation,” to substantiate its claims that the discriminatory aspects of its challenged policy are necessary to achieve its asserted objectives. Massachusetts has not even attempted to do so here.

2. Application

2.1. A state law is discriminatory in effect when, in practice, it affects similarly situated entities in a market by imposing disproportionate burdens on out-of-state interests and conferring advantages upon in-state interests.

2.2. One such form of discrimination is plainly when “the effect of a state regulation is to cause local goods to constitute a larger share, and goods with an out-of-state source to constitute a smaller share, of the total sales in the market.”

2.3. State laws that alter conditions of competition to favor in-state interests over out-of-state competitors in a market have long been subject to invalidation.

3. Facts

3.1. Parties: Plantiffs are Group of California Winemakers.

3.2. What Happened:In this case, out-of-state wineries contend that a Massachusetts wine-distribution statute violates the Commerce Clause of the United States Constitution, and is therefore unconstitutional and unenforceable. The primary question is whether the Massachusetts statue substantially burdens interstate commerce.

3.3. Ruling: federal district court agreed and issued an injunction to prevent enforcement of the statute. Massachusetts appealed.

4. Rule

4.1. The Commerce Clause prevents states from creating protectionist barriers to interstate trade.

4.2. Discrimination under the Commerce Clause “means differential treatment of in-state and out-of-state economic interests that benefits the former and burdens the latter,” as opposed to state laws that regulate evenhandedly with only incidental effects on interstate commerce.

4.3. A state law is discriminatory in effect when, in practice, it affects similarly situated entities in a market by imposing disproportionate burdens on out-of-state interests and conferring advantages upon in-state interests.