by Ben Lieberman
March 31, 2005

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On December 7, the United States Supreme Court heard the first major case dealing with Internet commerce, a Constitutional challenge to state laws restricting direct-to-consumer sales of wine and other alcoholic beverages. The Court’s decision, expected this spring, will very likely impact e-commerce in many other goods in addition to wine.

Imagine that you want to shop for wine online and have the purchase shipped to your home. Many wineries now have websites for this purpose—but in 24 states this transaction would be illegal. These states require all alcoholic beverages to pass through state licensed wholesalers, distributors, and retailers before they reach the public. Therefore, consumers bypassing these middlemen by purchasing directly from the web would be violating the law. The Supreme Court is now deliberating on challenges to two such laws, from Michigan and New York.

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