Published July 7, 2005 in issue 0427 of The Hook

By COURTENEY STUART

To ship or not to ship? That was the question the U.S. Supreme Court considered before ruling 5-4 on May 16 that states must allow wineries to ship wine out of state as well as in-state or allow no direct shipping at all.

The ruling is good news, says Dan Ortiz, a UVA law professor who filed suit against the Commonwealth in 1999 claiming that its ban on direct shipping from out-of-state wineries to Virginia retailers was discriminatory.

As a result, the state changed the laws to permit out-of-state wineries to ship to Virginia-- but only under certain conditions. Out-of-state wineries can ship no more than two cases to any customer; they must have permission from the winemaker to ship the wine; they must pay Virginia taxes; and they must buy a license to distribute in Virginia.

Ortiz claimed that was not enough.

The state removed the ban, he explains, but replaced it with other burdens to make it "difficult" for out-of-state wineries and "almost impossible" for out-of-state retailers to send their wine to Virginia.

The Supreme Court decision "helps us a lot," says Ortiz, whose appeal of those burdens goes before the Fourth Circuit Court of Virginia in Richmond later this month.

"The legal framework is even more favorable to us than the one that was in place before," he says.

But while Ortiz is pleased with the Supreme Court ruling, both he and Bill Moses, chairman of the Virginia Wine Board and head of Kluge Estate Winery and Vineyard, say the high court's ruling won't have any immediate effect on local wineries hoping to ship their products.

"The language was so broad that it really didn't tell you anything," says Moses. Sending the wine is one thing, "but who do we ship to?" he asks. Because other states will now have to rewrite their own direct shipping laws, Moses says, "It'll take another year or two to figure that out."

Dan Ortiz
PHOTO BY JEN FARIELLO

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