Opinion ID: 3162278
Heading Depth: 2
Heading Rank: 1

Heading: Twenty-first Amendment

Text: Indiana argues that the plaintiffs’ equal-protection challenge is “doomed” because state authority to regulate how alcoholic beverages are sold is “nearly absolute” under the Twenty-first Amendment. That’s a considerable overstatement. The Twenty-first Amendment ended Prohibition and restored the regulatory authority of the States over the transportation and importation of alcoholic beverages within their borders. More specifically, § 2 of the Amendment provides: “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.” U.S. CONST. amend. XXI § 2 (emphasis added). As the Supreme Court has explained, § 2 of the Twenty-first Amendment restored state regulatory authority as it existed prior to the ratification of the Eighteenth Amendment, but it did not immunize state alcohol laws from challenge under other parts of the Constitution. Granholm v. Heald, 544 U.S. 460, 484–88 (2005). Granholm was a Commerce Clause challenge to laws in Michigan and New York prohibiting out-of-state wineries from selling directly to consumers in those states. Id. at 465– 66. The Court invalidated the two laws, holding that the dormant Commerce Clause “does not allow States to ban, or severely limit, the direct shipment of out-of-state wine while simultaneously authorizing direct shipment by in-state producers.” Id. at 493. No. 14-2559 5 Along the way to this holding, the Court explained that “state laws that violate other provisions of the Constitution are not saved by the Twenty-first Amendment.” Id. at 486. To illustrate the point, the Court cited several of its cases applying other constitutional provisions to state alcohol regulation, including challenges under the First Amendment, the Establishment Clause, the Equal Protection Clause, the Due Process Clause, the Import-Export Clause, Congress’s Commerce Power, and the dormant Commerce Clause. Id. at 486– 87. Indiana points to other language in Granholm that in its view supports expansive state power to regulate alcohol without the usual constitutional limits. The Court said that “[t]he Twenty-first Amendment grants the States virtually complete control over whether to permit importation or sale of liquor and how to structure the liquor distribution system.” Id. at 488 (quoting Cal. Retail Liquor Dealers Ass’n v. Midcal Aluminum, Inc., 445 U.S. 97, 110 (1980)). This passage cannot be read in isolation. What comes next in the opinion clarifies the Court’s point: “A State which chooses to ban the sale and consumption of alcohol altogether could bar its importation; and, as our history shows, it would have to do so to make its laws effective.” Id. at 488–89. In other words, the States have the power under the Twenty-first Amendment to ban the importation of alcohol, but to avoid transgressing the limits of the dormant Commerce Clause, they may do so only if they also ban the intrastate sale and consumption of alcohol. The Court also said that the three-tier distribution alcohol system in use in many states—a system that requires the separation of producers, distributors/wholesalers, and 6 No. 14-2559 retailers—is “unquestionably legitimate” as state policy. Id. at 489. This statement, too, must be understood in context. The Court explained that “[s]tate policies [like the three-tier distribution system] are protected under the Twenty-first Amendment when they treat liquor produced out of state the same as its domestic equivalent.” Id. That is, the dormant Commerce Clause isn’t violated by a three-tier distribution system that treats all alcohol sales equivalently regardless of origin. These passages from Granholm make it clear that the regulatory power of the States under the Twenty-first Amendment remains subject to other constitutional limits, including the limits imposed by the Equal Protection Clause. See Craig v. Boren, 429 U.S. 190, 209 (1976) (holding that “the Twentyfirst Amendment does not alter the application of equal protection standards that otherwise govern this case” and striking down a law that permitted women aged 18–21 to buy beer while denying men the same right). That the States have broad authority under the Twenty-first Amendment to design their regulatory systems for the transportation, importation, and distribution of alcohol doesn’t mean they can ignore the rest of the Constitution. In short, the Twentyfirst Amendment doesn’t immunize Indiana’s cold-beer statute from equal-protection challenge.