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Economic Regulation & Property

Granholm v. Heald

Decided: 2005

In brief

The Twenty-First Amendment does not authorize states to discriminate against out-of-state wineries in favor of in-state ones.

The Court's ruling in depth

Michigan and New York allowed in-state wineries to ship directly to consumers but required out-of-state wineries to sell through wholesalers. Small out-of-state vintners sued, arguing the schemes violated the dormant Commerce Clause. Justice Kennedy's opinion held that the Twenty-First Amendment, which gives states broad authority over alcohol, does not displace the Commerce Clause's core anti-protectionism principle. States may adopt uniform three-tier systems and may regulate alcohol on non-discriminatory public-health grounds, but they may not tilt the playing field in favor of their own producers. Granholm reshaped the wine and craft-beer industries and is the leading modern case on the interplay between the Twenty-First Amendment and the dormant Commerce Clause.

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