Supreme Court: Alcohol distribution law unconstitutional

BY ASSOCIATED PRESS
01/26/2020 10:00 AM
OKLAHOMA CITY (AP) — A divided Oklahoma Supreme Court on Wednesday ruled that a law requiring the top 25 brands of wine and spirits to be sold to all Oklahoma alcohol wholesalers is unconstitutional.

The 5-4 ruling means alcohol manufacturers can designate a single wholesaler in the state to distribute their products.

A spokesman for the state attorney general's office, Alex Gerszewski, declined comment on the ruling.

The law, sought by small alcohol wholesalers that did not merge with larger out-of-state distributors, was passed by the Legislature and signed in May by Gov. Kevin Stitt. It requires the top brands of wine and spirits to be sold to all Oklahoma alcohol wholesalers.

The law altered a constitutional amendment approved by voters in 2016 allowing manufacturers to choose a single wholesaler, while also allowing the sale of wine and strong beer in grocery and convenience stores and the sale of cold, strong beer in liquor stores.

The law was challenged by two liquor wholesalers in the state that merged with large national distributors for exclusive distribution rights to the top 25 brands of wines and spirits.

The state Supreme Court's decision upholds an August ruling by District Judge Thomas Prince that the law is unconstitutional.

“The law is clearly, palpably, and plainly inconsistent,” with the constitutional amendment, and “is not a proper use of legislative authority,” Justice James Winchester wrote for the majority.

The ruling does not violate state rules banning monopolies, Winchester wrote.

“The plain language of (the amendment) is not in conflict with with the anti-competitive provisions of the Constitution," he wrote. The amendment itself “allows liquor and wine manufacturers and wholesalers to have exclusive distributorships,” according to the opinion.

Winchester also wrote that the amendment's language is permissive in that it allows wine and spirits manufacturers to sell to more than one wholesaler if they so choose.

“The Legislature's authority to impose such a requirement comes from the constitutional provision itself wherein it requires the Legislature to enact regulatory laws regarding alcoholic beverage sales,” wrote Justice Yvonne Kauger in a dissenting opinion.

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