it's businesses from engaging in a particular activity which would otherwise be available to them and would otherwise be lawful it limits competition but it is not the sort of data exchange of price information or any have and should have the benefit while you discounts the benefit of all of those make sense in the pen at least they don't lose any of their significance in terms of uniform pricing in the state's ability to regulate without price posting what they lose is what the state loses a little bit of impossible to enforce but it becomes much more difficult so you have to start proving intent you have a whole lot of issues that there aren't there otherwise but what the trial court fundamental error in this area was a failure to give proper deference to look at all of the price related prescriptions as a whole i think the first thing you have to do is look at the look at it as a whole and say as a hyper unilateral i believe look at the whole i think you conclude if you will that you know when you start to look at some of these specific provisions there percy violations of the shawn act either now i don't believe they are there are other reasons why that may or may not prohibit the state from doing that but on the surface i don't i don't believe they are with the possible exception of price rationing no private decision making there's no private regulatory power imagine for example two states with identical credit losses one has a price posting system the other doesn't to me it makes no sense to sa and ruled on that basis that the laws had to be thrown out as a whole i submit again that that's the tail wagging the dog the state has commanded that you do or not do certain things it is given no discretion given no private regulatory power is simply said that you cannot if you are excuse me if you are dealing with retailers you cannot charge for it there is no private decisionmaking being enforced by that law other than perhaps you could say the decision to if you want a piece of it going going well i don't think that's an appropriate description the specific is already determined by having the severability clause and legislatures already said we want to these provisions in there the legislature has declined to amend the law  since the judge becker initially ruled i think it's i think this the promise of this court to assume that the legislature intended any of the provisions that are constitutionally infirm to remain in effect it's it would be extraordinarily difficult in fact the court the legislature could react on the other hand if you say that the frozen hold is invalid and everything else is valid the legislature would then be in position to remove any provisions that they chose not to our point is not that the lives of these laws are right or wrong  should take the opportunity to clarify the reach of miller this that's near makes no sense to say you have to have concerted activity in order to have a person a violation there's no concerted activity here but there's a per se violation bill or maybe may very well be read to say that any price posting system that allows an exchange of information is invalid if that is the ruling if that is what it means then the washington laws invalid i believe that that ruling doesn't there is that concerted activity as an essential element of a person a violation member this all goes back to rights that says before there can be preemption you have to have the state has to mandate or permit activity conduct that would be a per se violation court time to analyze the case without and doing seventy years of existing regulatory structure in the meantime we will take your motion under advisement thank you the trial court's decision in this case impact ordering of the market and just ability and the uniform prices that's achieved by the regulatory structure continues to exist regardless of the legislature's most recent decision to allow direct sales from producers but yeah and out of washington to washington state retailer there is an active supervision by the state that's one of the requirements and one of the spectrum you could have total for example public utility regulation where the state thank you post the entire regulatory opportunity if the system doesn't allow the actors to get together and collude or anything approaching collusion in setting their price then that obligation of the state to supervise by individual eyes face review doesn't exist it the ability to have an advanced look and interestingly when that didn't the case that was decided by this court in miller went back to the trial court for its twenty first amendment analysis that trial court found that the actors were using the system the system was available to allow them to step two get together and collude and agree and signal on prices before they became final that's not possible in washington there's no evidence in this do that you want to get there they just record it is a matter of law on that issue when it gave the limited federal interest in liquor composition greater constitutional significance than washington state substantiated twenty first amendment interest washington state proved at the trial that it's regulations implicate and so it's twenty first amendment court concerns of orderly markets temperance in the sense of controlled responsible overall consumption and it serves the interests state's interests of revenue a situation in which our expert testified as to each of them individually and as to the package that they had for each of them had a tendency to facilitate interdependent pricing separately they did not rebut that in fact their expert agreed on a number of them that it had that possibility they claimed that prices were artificially inflated of both competitive levels and the only way that could happen is if in fact there also a facilitating practice any time you simplify what the parties need to look out for in terms of interdependent pricing if you require uniformity if you eliminate quantity discounts if you require deliver pricing you are making interdependent pricing more likely and that is exactly what this court and the supreme court three two four and the fourth circuit m t f of us said it was the vice of these things that they have a that part of it the key part of setting the ultimate price and they facilitate those prices being artificially high interdependent ways in which there can be a complication ways in which other participants can cheat on the interdependent pricing and ways in which retailers conserve convent the interdependent price and that goes even for the ones that were mentioned earlier as being somewhat less directly priced related such as retail sad every hotel prices for a liquor shop the ex just set the prices and then set a bunch of rules to force such as you can't have a discount  prices as they watch each other post off as the whole keep spent target price in place as it's easy to understand what your competitor do because there are no quantity discounts there's only delivered price when there is no cheating by the competitor  circumvention by the retailer it allows that price to go up the state is not fixing or setting the price in fact the chair of the liquor control board specifically said that the state is not doing that in fact it's the state philosophy he claims the prices should be reasonable in that they were not trying to reduce consumption artificially very increasing prices but in fact all of these facilitating practices each of which is per s when companies get together and say to themselves we will exchange current prices not just advance look prices but current prices that's not only per se it's criminal under our any trust laws in clearly there is inconsistency with federal law a preemption by federal law where the state offer race authorizes parties and tells parties to engage in conduct that the federal government thinks is criminal because it interferes deliver pricing in a very unknown quantity discounts exactly what you're talking about is that those facilitate this interdependent price it's the ultimate price setting that if you leave back to the private parties and then you make first that logic would apply specifically to deliver pricing in the quantity discounts in miller in t f to the us the rule of the anti trust laws is that you look at the whole package and here it was the defendants again repeatedly told us you conspiracy you're looking at all of the effect on competition of the entire regime that has been established and that's all we're asking here are both sides in agreement that we can't look at them item by item we have to look at the they were certainly in agreement at the district court and sometimes in their briefs now when it suits their purposes that these have to be looked at together chairman wong testified to the district court repeatedly that they were interlocking when we asked them their position that they have taken well is that true for the price related aspects as well as for example central warehousing and so forth look look at all of that the entire package or can you s least the price impact or price related if you look at the history that we presented for example as the central warehousing the history is that it was part of maintaining those same margins to avoid any erosion of the interdependent setting the price but i do not agree that they are unilateral in the sense for a couple of reasons i don't think we need to go to each of them individually in this case you have a market participant the liquor control board which is  and i know that why i think it was we did not have to go there but we did mention it below and certainly we can defend the result below on any ground that is in the record below it's it's obviously clear that there are market participants and in fact we had them testify in trial that where said both buy and sell wine they don't follow these restraints and buying they don't follow them in selling and they have no difficulties in satisfying any state purposes and that's the chart that we've provided the court which kind of shows the basic structure currently of the washington servicing consumers in various routes the fact that you have two major routes that are now unrestrained including the one operated by the state stores strange new problems satisfying the state's interests and of the twenty first amendment i think if i could just mention one thing with respect to this question this was an interesting question as to actual collusion in hybrid and the like but i would remind you of what such a ludicrous setting concurring in the t f to of us case which is that you cannot get around the plain language and holding a three to four and of miller and of the supreme court cases and how they explained fischer he was candid enough to say perhaps the supreme court was wrong but it's their job to correct that that is the position the defendant should have i share some of his concerns which makes it very difficult to apply logic  antitrust law and the reason is that there is more to federal any trust law than the element of combination or conspiracy and combination itself can have a very broad meaning and understanding as this court other courts have pointed out but it was snake river case for example which the other side has mentioned was a section two case primarily there was no requirement of a combination or conspiracy and yet the preemption still was a possibility if you look at the logic  as to these competitive elements it is still very inconsistent even for the state to ban in a certain unilateral sense to limit that interdependent decision making and i think that the court would find in this use the the gist of the lopaka article that we've cited to you i think the court would find you squarely presented with this is that where that price element is still not control and where there is still private discretion in the price filament and it is not actively supervised if the state takes away independent competition of elements fundamental to getting to that price then it is in cons the prices are not higher than they need to be is reducing consumption is in fact your goal which the record is quite quite clear was not the goal of the state of washington the they would have to look at that and make sure that it's not higher the prices are not higher than necessary and the prices are in fact satisfying some stated goal that's all that is required this is not a healthy state sovereignty the federal courts of this court in the supreme court in these cases are simply saying that if you are going to interfere with the nerve center of competition independent decision making as to these elements then you need to substitute some in forstmann to make sure prices do not further that purpose in some way and they have to come forth and show that the extent to which they further it outweighs federal antitrust concerns that there's try much time expert testimony put on to demonstrate remember the snippets that they flatly don't actually make the kind of showing this court procedure is required to challenge factual findings they pull out a few snippets and throw them around but they don't tell you is the clear evidence in the record that temperance in the state of washington does not mean artificially reducing consumption of wine and beer or artificially increasing prices and was admitted by their historical expert it is rife in their documents about how they general economic theory use that in the price increase in line in beer is going to reduce consumption for for a couple of reasons he admitted that there wasn't high elasticities there largely inelastic moreover he admitted that the money that would come in to the distributors the excess money could be and probably some of it would be spent on increasing promotion of alcohol the supreme court in the you know my case said that the one of the best ways to understand the effect of an anti competitive scheme is what the private participants in it think it will accomplish and the testimony that was before the district court was quite clear that the distributors thought that this would increase their margins but it would not decrease their sales that they would be better off financially which is not what you would expect if there was that clear supply demand price demand dimension  fact they basically said that it was in response to discovery and again this was in the record that there was no inconsistency between orderly markets and normal competition so they are i believe that they basically and i think they convinced  orderliness did not have any that would be important here and yet and on the burden of proof let me just mention a couple of cases that i would draw your attention to one of them is forty four liquor mart which says that midtown stands for the proposition quote that the twenty first amendment does not in any way diminish the force of the supremacy clause as carried out by the sherman act going way back to north dakota and i again apologize for  missed citing it in our opening brief but for them to rely upon that old case which has no direct statement as to any bearing on this case and you with new or grand home in forty four liquor mart simply inexplicably was granted home say in your view the granholm clearly says the burden is on them and he addresses this question of how heavy the burden leaders there were it was not in summary judgment there were declarations from state officials that assumed and suspect that this was important to controlling the possible problems possible temperance related issues in michigan and the courts and that's not enough there's there's not sufficiently substantiated over macallan three to four the state of washington that limited to the interstate discrimination in effect well the i think the understanding of how you look at evidence isn't limited in that way but remember that the interstate discrimination is just part of the commerce clause and what the supreme court said in midtown forty four look remark is that begin to trust was the schuman after is a way that congress has fully carried out the commerce clause so you really can't separate those and that's why forty four liquor mart said the twenty first amendment is not a limitation on the any trust analysis the if you go back to mid callen three to four that there are limits to that analysis or they're not they're certainly at a competitive per se violations  there are protected by the twenty first amendment or not none have been found by the courts so far that i'm aware of in every case and that's where the problem that they have where there has with the other end is is it's going to have very little and exactly pervy brown as a way of protecting state sovereignty where the state shows that because it clearly articulated a deliberate purpose and because it actively supervised means that there is a prime good element in that ultimate price that affects the consumer which is what we're concerned with under the any trust was and therefore once you conclude that there is that private element then you have to have active supervision so if there is a private element you have to have active supervision if there's active supervision the private element is taken care of by the end of supervision it seems to me they are very closely related kelso i don't recall you address the central warehouse of the issue of central warehousing and also the issue that we lost on the retailer to retailer sailors are two that the just record specifically looked down and i think because of that it's very unfair for the defendants to suggest that the district court did not look at each of these restraints are evidence as to the any competitive the facts for professor leffler addressed each of them separately the district court looked at these two these happen to be the two that they focused on the most but i think that's because they basically concede that everything else is unconstitutional as to these two they are not quite as directly related to price but they are part of this overall integrated interlocking regime the purpose of which is to get at a price that goes from the distributor to the retailer and i see no reason functionally or  why state initiatives that cut off circumvention of intuitive and pricing should be analyzed any differently than state initiatives and pricing they ought to be looked at similarly there this is not an area where the law as clear as in everything else in this case but it is seems to be the logic is the same in that they've given no reason to think that the logic should be any different both of those two restraints with the per se violations look can sell to another retailer and the testimony at trial showed well they didn't think there was any problem with that it didn't affect any twenty first amendment interests there wasn't anything special they did to track those sales from them as retail or to some other retailer they are a market participant in they are the ones who are imposing this on other market which is what is in the have seems very clearly to be a combination in violation of the trust laws but even if the edict you will not have a central warehouse sounds more unilateral in this context where it is a way to enforce which is what they said both in the evidence in the in their arguments to the will work or ways to enforce the other parts of the regime then it should be dealt with the same way and the the the severability clause is in the desire of the court understandably not to strike down more than it needs to which judge packman obviously felt as strongly as this worth feels simply shouldn't enter into this we're not asking you to strike down the entire state regulatory system we're not even asking you to strike down entire sections or subsections we simply asking you to enforce the lower courts injunction against carrying those out in the specific ways each of which has been in a competitive effect each of which was argued by them to be  understand it basically what they're saying to you is so is your mother really like this county commission and things like that right this that they decided to stop this study commission not of the the liquor control board not to make any recommendations after it was done to try to keep the the fact is we all have to try and will they have a law they they don't have to they're not entitled to a stay saying you don't have to worry about offending the law in the future that's really all they're saying at this point is that we have violated the law for years the district court found that we have violated the law this court in snake river suggested that the distributors would be liable for damages if in fact they did not have a good faith justification terms of complying with state law at this point time has run out they should be told so of bay the district court injunction if this court should reverse at some later date no harm will have happened the restrains c back into a fact that there is not going to be anything terrible is going to happen in the meantime they didn't prove that to the just report they haven't proven it in their declaration draft davis thank you counsel your time has expired we will hear hole under miller ok i'm not sure you need to but if you do you'll see the severability principles require that you look at all of the others in the penalty and they are clearly unilateral but it turns very briefly to the twenty first of images i think there are three legged doesn't think the twenty first amendment means anything anymore apparently you know i don't believe you get to the twenty first amendment in this case but under and because i don't think you need to but under mr westermann just for the sake of argument assuming we get to the twenty first a actual private parties dictating prices from one to the other just lance one of the moment i don't know if i left any time or