Granholm v. Heald, 544 U.S. 460 (2005)

In Granholm v. Heald, the underlying dispute arose from state laws in Michigan and New York that regulated the sale of wine from out-of-state wineries to consumers. Both states implemented a three-tier distribution system that allowed in-state wineries to sell wine directly to consumers while prohibiting or economically disadvantaging out-of-state wineries from doing the same. This regulatory framework was designed to provide a competitive advantage to local wineries, effectively limiting the ability of consumers to purchase wine from out-of-state producers. The procedural history of the case involved challenges to these state laws, which were consolidated for review by the Supreme Court. The case reached the Court after the Court of Appeals for the Sixth Circuit invalidated Michigan's laws, while the Second Circuit upheld New York's regulations. The Supreme Court granted writs of certiorari to both appeals, allowing for a comprehensive examination of the issues surrounding interstate commerce and state regulatory authority. Relevant background context includes the broader regulatory landscape governing the sale and importation of alcoholic beverages in the United States, which is shaped by both state and federal laws. The three-tier distribution system, which separates producers, wholesalers, and retailers, is a longstanding framework that states have the authority to enforce under the Twenty-first Amendment. However, the differential treatment of in-state versus out-of-state wineries in Michigan and New York raised significant questions regarding the constitutionality of these laws under the Commerce Clause, as they explicitly discriminated against interstate commerce.

Whether state laws that permit in-state wineries to sell wine directly to consumers while prohibiting or significantly restricting out-of-state wineries from doing so violate the Commerce Clause of the Constitution.

The judgment is reversed.