Seventh Circuit Upholds Indiana Alcohol Laws Without a Majority Opinion

After one judge died, the two remaining judges could not agree on why the state should prevail.

This week, in Chicago Wine Co. v. Braun, the U.S. Court of Appeals for the Seventh Circuit affirmed a district court decision rejecting a constitutional challenge to an Indiana law barring out-of-state retailers from shipping wine to customers in Indiana. Yet there is no majority opinion of the court.

The case was initially heard by a panel consisting of Judges Kanne, Eaterbrook, and Scudder. After Judge Kanne's death, Judges Easterbrook and Scudder could not agree on why the state should prevail, so the court issued a per curiam noting that the district court was affirmed, and each judge issued an opinion explaining his reasons why that should be.

Dormant commerce clause doctrine is not known for its clarity (nor, some would say, its consistency). This judgment by the Seventh Circuit would seem to support that opinion.

Comments

[Area Man]

“Dormant commerce clause doctrine is not known for its clarity (nor, some would say, its consistency).”

Or its existence as a valid constitutional doctrine.

[Supremacy Claus]

"Dormant commerce clause doctrine is not known for its clarity (nor, some would say, its consistency)."

It is made up toxic lawyer bullshit.

Main “Tests” — All Made Up
1. Facial Discrimination → Strict Scrutiny
If a state law explicitly favors in-state over out-of-state goods/services, Court almost always strikes it down.
Example cases:

Philadelphia v. New Jersey, 437 U.S. 617 (1978) – NJ ban on out-of-state waste invalid.

Granholm v. Heald, 544 U.S. 460 (2005) – Wine shipping rules favoring in-state producers struck down.

2. Pike Balancing Test (pure judicial vibes)
From Pike v. Bruce Church, Inc., 397 U.S. 137 (1970):

Law upheld unless burden on interstate commerce is clearly excessive vs. local benefits.
Criticized because:

No formula, no metrics.

Judges guess what counts as “burden” or “benefit.”

Outcome depends on the judge’s personal policy preferences.

Loopholes / Exceptions
Congressional Authorization: Congress can bless state laws that would otherwise violate DCC (Western & Southern Life v. State Bd. of Equalization, 451 U.S. 648 (1981)).

Market Participant Doctrine: If state is a buyer/seller, not regulator, it can favor in-state entities.

Why It’s “Made-Up”
No textual basis in the Constitution — entirely judge-created.

Anti-democratic: Lets unelected judges strike down state laws without Congressional action.

Economically illiterate: No data, just judicial guesswork.

Federalism distortion: Overrules legitimate state policy choices.

Inconsistent: Same facts → different results depending on the court.

Biggest Critics
Justice Scalia: Called Pike balancing “a judicial fraud” — would limit DCC to facial discrimination only.

Justice Thomas: Would abolish DCC altogether; leave it to Congress to regulate or preempt.

Key Cases to Name-Drop
Gibbons v. Ogden, 22 U.S. (9 Wheat.) 1 (1824) – seeds of the idea in dicta.

Cooley v. Board of Wardens, 53 U.S. 299 (1852) – “selective exclusivity” theory.

Philadelphia v. New Jersey, 437 U.S. 617 (1978) – facial discrimination bad.

Pike v. Bruce Church, 397 U.S. 137 (1970) – invented balancing test.

Granholm v. Heald, 544 U.S. 460 (2005) – modern example of striking state favoritism.

South Dakota v. Wayfair, Inc., 138 S.Ct. 2080 (2018) – recent reshaping of commerce rules.

Bottom line:

The Dormant Commerce Clause is judicial policymaking dressed up as constitutional law — no text, no formula, no consistency, and plenty of “my gut says so” rulings.

[Supremacy Claus]

Here a Nazi bigot refused to serve food to a Jew. All people listed in Plaintiffax should be refused products and services.

https://www.msn.com/en-us/news/world/alan-dershowitz-refused-a-pierogi-a-second-time-at-farmer-s-market/ar-AA1K5YpF?ocid=msedgdhp&pc=U531&cvid=6895fdf8a47645188f2cad888fdcb9cd&ei=30

[Supremacy Claus]

Whenever judges make she up, it is insurrection against the constitution. Arrest them. Try them. Imprison them 10 years. Put them in gen pop.

[Rossami]

Oh, I disagree. The Dormant Commerce Clause in an entirely valid constitutional doctrine - for everything except alcohol. Alcohol regulation is controlled by the text of the 21st Amendment.

[Area Man]

The DCC is directly contradicted by the text of the Constitution. Article I, section 10 is completely irrelevant under the rationale of the DCC. And if valid , a similar concept should also apply to other powers listed in Article I, section 8, such as implicitly denying states the ability to “lay and collect taxes” or “constitute Tribunals inferior to the supreme Court,” yet it doesn’t. And, of course, the power to regulate interstate commerce is an affirmative power of Congress. If Congress wants, it can override state laws that do so either expressly or implicitly through positive legislation. If it doesn’t, it’s a sign that Congress chose to not exercise its authority, and the 10th Amendment’s default provision applies. Absolutely nothing gives the judiciary the authority to exercise Congress’s powers for it.

So, the DCC is made up bullshit. Maybe it’s good policy. Maybe we should codify it with a constitutional amendment. But, as written, it’s not supported by the Constitution.

[Sarcastr0]

Literally area man.

[Soronel Haetir]

I would think the special permission granted to the states regarding alcohol regulation would make usual dormant commerce clause analysis moot anyway. In this one area they are given a very specific grant of power ("The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating
liquors, in violation of the laws thereof, is hereby prohibited"). That would seem to defeat any requirement that the state treat in-state and out-of-state producers equally.

[wvattorney13]

That has some limits, though. The state couldn't have racial bars on alcohol purchases.

I think there has to be some rational basis for these laws and I can see none. They are just protectionist rackets for preferred sellers.

[Brett Bellmore]

Setting aside that "rational" basis is actually "not chewing the sofa insane" basis, there is one here: The state wants to favor domestic producers.

Yes, it's a protectionist racket. The state is permitted to have one, once the interstate commerce clause is out of the way.

[wvattorney13]

That might be "rational" for some definitions of the word, but it is ultimately an illegitimate function of government. The government is supposed to facilitate the sale of wines and give consumers convenient options and good prices---not enrich their cronies.

I'm skeptical of the 21A jurisprudence that uses the throwaway line about violating the state law as a license for the state to ignore the rest of the constitution. Do you believe that IN could bar the sale of wine to blacks under its 21A power (given that the 21A would supersede the 14A being passed later)?

[Brett Bellmore]

My point is that all "rational basis" means in practice is that the judge applying it says they can't imagine anybody who wasn't literally insane wanting the law. Laws that are genuinely irrational in the sense of advancing really bad ideas pass rational basis all the time.

Not insane in the sense of motives, insane in the sense of "In order to advance the availability of bird seed, the rules of Poker are now changed so that one pair beats royal flush"; Insane in the sense of you'd have be insane, not just wrong, to think the law would advance its stated purpose.

"Do you believe that IN could bar the sale of wine to blacks under its 21A power"

This is where the presumption against implied repeal in constitutional law comes into play: The 21st amendment was expressly depriving the federal government of the power to regulate alcohol contrary to the laws of a state. It was specifically directed against the commerce clause.

It was not express about overturning the 14th amendment. And the 14th amendment is very clear.

So it would not be interpreted as overturning the 14th amendment.

[wvattorney13]

"The 21st amendment was expressly depriving the federal government of the power to regulate alcohol contrary to the laws of a state. It was specifically directed against the commerce clause."

Your second sentence is ipse dixit to stop the absurd result of racial restrictions. If the feds have no power to regulate alcohol contrary to the laws of the state then the state could pass any law, including racial restrictions, and the feds couldn't touch them.

I think the much better reading is that yes, states can have their own alcohol laws, but those laws, like any laws, must comply with the rest of the Constitution.

[Incunabulum]

None of that is the function of government.

[Brett Bellmore]

That's my thought, too. Even if you take the dormant commerce clause seriously, alcohol is, expressly, the one thing NOT subject to it. If you're applying normal rules of construction, rather than "the federal government wins anything we can pretend is a tie" rules, this is a no-brainer: The 21st amendment is much more recent, and exactly on point.

[Frank Drackman]

Indiana doesn’t allow convenience or grocery stores to sell cold Beer, and before you think it’s a safety measure to cut down on drinking and driving, you can get cold Beer, but only at Liquor stores.
It’s about the only thing I remember about Indiana (Oh, and the “House of Mud” don’t miss it!)

Frank

[defaultdotxbe]

Also, liquor stores can't sell cold soda, but grocery stores can.

[energizzer]

Please tell me they regulate exactly how cold the beer can be before it’s too cold. Like what if they just had a room. With really cold AC and that’s where all the beers were kept.

[Rob K]

They do.

[Alan Gunn]

I live in Indiana. I don't know why this happens, but with a bit of searching I've found liquor stores (not just wineries) that will ship wine to Indiana and a couple of places that will ship Scotch. I've made feeble efforts to find out how they can do this, but I don't much care as long as I can find them.

What Frank Drackman said about Indiana rules about cold beer (or maybe even all beer) on Sunday was true a few years ago. But a guy who owned a convenience store got away with it because his store had a few booths where people who bought pop (that's what we call soda here) or snacks could consume them, making the place a restaurant, and restaurants, like liquor stores, can sell cold beer (or maybe all beer) on Sunday. So we had a fuss about letting grocery stores do it too. The liquor stores complained, and it was the subject of long and heated discussion, sort of like a debate, although debate seems to me to require disagreement about the merits, and in this case it was just pure politics because the case for limiting grocery stores' sales but not other merchants' sales has no merits. In the end, I think the legislature made some sort of compromise. Something like allowing grocery stores to do it, but only after noon, but I'm not sure.

[wvattorney13]

In my state, the stores will have a drive up window. They can sell beer and wine through the window but they cannot sell liquor through the window.

I fail to see the protection to the public that allows me to drive up and buy beer and wine but forces me to park the car, walk in, pay, and then walk out with the liquor.

It seems that many states have alcohol related laws that are just bizarre. If they were only strict, then I could understand the rationale, but I don't know why states persist in having laws that are well known silly annoyances.

[Michael P]

This seems suspect to me. Judge Scudder's opinion is much better overall, and I agree strongly with its classification of the basic scheme as discriminatory against out-of-state entities (Judge Easterbrook disagreed on that point, and stopped there). But I part ways with Scudder -- and the district court -- here:

The district court agreed, relying on a sworn declaration from an Indiana State Excise Police Sergeant Brian Stewart to conclude that the challenged regime “helps advance the State’s interests in keeping alcohol out of the hands of minors, controlling the quantity of alcohol in the State to curtail public health concerns, and protecting against unsafe or counterfeit products.” Chicago Wine Co. v. Holcomb, 532 F. Supp. 3d 702, 714 (S.D. Ind. 2021).

This is true on its face, and the training and licensing requirements should be sustained on that basis. However, the restriction of licenses to in-state locations does not support those goals, and so it should be prohibited. (That part of the regulation is not statutory, but only part of Indiana practice.) I am sympathetic to the argument that this is an integral part of Indiana's three-tier distribution system, but the better solution is to require all alcohol sold to Hoosiers to use that system. This makes compliance Chicago Wine's problem and probably achieves the same end without offending Supreme Court precedent.

I don't expect this will get further review (en banc or cert), much less overturned, but that's how I would have decided the case.

[energizzer]

Easterbrooks had some head scratchers lately

[wvattorney13]

All of those excuses are laughable pretexts. IN could require adult signatures on wine delivery and solve their alcohol to minors problem just as easily.

More alcohol in the state? Whether I buy wine from an out of state supplier or an in state supplier, then amount of alcohol needed to flow to me is the same. I am not drinking twice as much because I have the option of ordering from twice the number of businesses. I don't eat twice the amount of food because a new grocery store opens in town.

And all of their complaints are equally valid against in state suppliers. Courts should not countenance bald face lies to them.

[Michael P]

Scudder lays out the better reasons that it's an integral part of Indiana's distribution laws -- for example, the licensed delivery personnel are trained on detecting fake IDs and not delivering to intoxicated recipients. But other parts are IMO specious: for example, Indiana wants in-person inspections of some fraction of retail licensees each year to check those training records and booze storage and such, with one example being that an inspector found evidence of bootleg beverages during one inspection. It is harder for inspectors to visit out-of-state licensees, but it's no harder than for their delivery personnel to make deliveries. Scudder also says that it's not clear that inspectors would have jurisdiction to perform those inspections, but that can be an explicit part of the license. The discrimination against out-of-state prospective licensees is not an integral part of their regulations, so it should be void.

[wvattorney13]

I still think those are pretexts. It isn't like IN has special countermeasures for detecting fake IDs or selling to intoxicated people. The alcohol industry across the country has taken such measures. To say that IN has to have its own procedures is simply a pretext.

Same with bootleg liquor. I buy stuff on Amazon all the time from out of state and there is no handwringing that I am getting authentic product. Hell, I can order direct from China and the state doesn't care.

This is all pretext and misleading the courts.

[Frank Drackman]

I just did the John Boehner method, got a cup of Ice and a Fifth of Maker's Mark

[Poxigah146]

It's very clear to me that the Indiana law is constitutional, but it's also clear to me that these laws demonstrate how our current system of representative government does not work.

Almost nobody supports these laws, or car dealer franchise laws, but they persist because business owners who will benefit lobby for them, and the benefit they get outweighs the detriment to the rest of society, so people don't fight back against them as hard as they fight for them.

[wvattorney13]

I think this is where a strong privileges or immunities clause enforcement would be appropriate.

Indiana is not a prohibitionist state. Selling alcohol is not against public policy. That being the case then it should be open to everyone to sell alcohol on equal terms so long as they follow the law. Same with selling cars.

Protectionism should never be a legitimate function of government.

[Poxigah146]

Yep, I'm not even specifically talking about this law, but any law that is nearly universally opposed by the people, but lives on because of corporate lobbying.

Mass immigration is another great example.

[ReaderY]

21st Amendment repeals priveleges and immunities so far as alcohol is concerned. Its text explicitly permits protectionism. See my comment below. Don’t like it, amend the constitution.

[wvattorney13]

"The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited."

21A, Section 2. Your stated position is unsupported by this text. By my reading this simply allows states to remain prohibitionist if they choose and that their local laws have to be respected.

It doesn't, facially or implicitly, suggest that a state's lawmaking authority in this area is special or free from the other constraints in the constitution--that it bushwacks the privileges or immunities clause, the commerce clause, or the equal protection clause.

As I have suggested in other posts, your view would state that IN can ban the sale of alcohol to blacks. If the 21A torched privileges or immunities, why not due process and equal protection? They are part of the same amendment.

[Alan Gunn]

This is a nice example of public choice theory. The local businesses get enough benefits that its worthwhile for them to contribute to the campaigns of legislators who will vote for these laws. Some of their customers dislike the laws, but few if any of them will make campaign contributions to candidates who oppose them or even vote against candidates who support the laws even if they know how their particular state legislators voted. And most of us care more about other issues anyway. Not all "discrete and insular minorities" lose out; car dealers, liquor stores, farmers and many other groups get special favors because they are minorities.

[Poxigah146]

Right, exactly. They're things that carry enormous benefits for the beneficiaries, so they fight like mad to get these privileges, while the harm to everyone else is much more abstract and hard to measure, so, even if they oppose them, they don't really focus energy toward fighting them.

[ReaderY]

I think Tennesee Wine was wrongly decided. The 21st Amendment specifically permits statws to prohibit importation of alcohol. into the state. A prohibition on importation necessarily discriminates against out-of-state alcohol interests in favor of in-state alcohol interests. Thus, by its plain terms, the 21st Amendment specifically overrides the Commerce Clause and permits states to discriminate in favor of in-state alcohol.

Tennessee Wine’s attempt to “balance” the 21st Amendment against the Commerce Clause makes about as much sense as if the Supreme Court had attempted to “balance” the 13th Amendment with the Fugitive Slave Clause so as to give both effect. One could imagine an analogous opinion saying prohibitions on slavery are permissable only to the extent they don’t interfere with certain interests identified in other clauses The 13th Amendment doesn’t work that way. It prohinits slavery in its entirety and extinguishes the Fuitive Slave Clause and all other contrary clauses in their entirety to the extent they address the subject of slavery. There is no balancing to perform.

I think exactly the same is true with the 21st Amendment. The 21st Amendment extinguishes the Commerce Clause in its entirety and permits a state to act as if it were a completely independent nation rather than part of a federal commercial system where the regulation of alcohol is concerned.

[Brett Bellmore]

That's basically the way I understand it. This is the one case where the commerce clause, dormant or otherwise, is completely inapplicable, having been deliberately overruled by an on point constitutional amendment.

[Poxigah146]

Yes, and it was probably be design. They couldn't get 3/4s of states to agree to repeal the 18th unless they had basically complete autonomy to regulate alcohol as they saw fit.

[wvattorney13]

I'm still not seeing how all of that gets read into what seems to be a throwaway line that states can have alcohol related laws.

[Poxigah146]

You have to think of it in context. Obviously, doing things against a state's law would be illegal. It wouldn't need to be said. What it was saying is that the states had the right to set laws that it couldn't otherwise (and likely, that Congress could prohibit alcohol trafficking as well).

[wvattorney13]

There is no "couldn't otherwise" in there. It was meant to allow states to remain dry in case there was any doubt. The 21A was not a "national wet" amendment.

[ReaderY]

It doesn’t just say “they can have alcohol related laws.” It says they can regulate the importation of alcohol into the state. That is, it specifically says they can regulate interstate commerce in alcohol with respect to their state. That’s what importation is. That’s a take-back of the Commerce Clause.

In general, constitutional amendments don’t get cramped readings. They get liberally construed.

[wvattorney13]

It says that they can regulation importation of alcohol into the state in violation of its laws. It doesn't say that it can make a certain alcohol thing generally legal EXCEPT for out of staters. That runs right into the teeth of the original privileges and immunities clause.

If wine can be delivered to a customer's door, then an out of stater shipping to a customer's door is not violating IN public policy. It is violating an unconstitutional law which goes against the constitutional design.

IN is free to outlaw alcohol. It is free to outlaw direct to consumer shipping. What it cannot do is prefer a certain group to the exclusion of another group.

[ReaderY]

It may well do. There may have been a privelege to have an alcohol business or to import alcohol into a state prior to the 21st amendment. There is no such privelege or immunity afterwards.

The 21st Amendment changed the constiutional design. It’s what amendments do.

Under a fair reading ot the 21st Anendment, states can implement protectionist schemes for alcohol if they want to. It’s up to them.

They can’t have whites-only bars, and the police can’t go into bars and shake the customers down. It doesn’t override the 14th Amendment’s Due Processs and Equal protection clauses. But it pretty clearly overrides the Commerce Clause. And it extinguishes any proor privelege or immunity with repect to alcohol. So far as alcohol is concerned, each state is its own nation.