Court Opinion

ID: 9430531
Source: CourtListenerOpinion
Date Created: 2023-08-02 23:29:57.599361+00
Date Added: 2024-06-11T17:23:24.880416
License: Public Domain

Justice Stevens,
with whom Justice White and Justice Rehnquist join,
dissenting.
Speculation about hypothetical cases illuminates the discussion in a classroom, but it is evidence and historical fact that provide the most illumination in a courtroom. Forgoing the support of a record developed at trial, appellant BrownForman Distillers Corporation (Brown-Forman) contends that New York’s Alcoholic Beverage Control (ABC) Law § 100 et seq. (McKinney 1970 and Supp. 1986) is an unconstitutional burden on interstate commerce “on its face.” Over 20 years ago this Court unanimously refused to invalidate the predecessor of New York’s present statute on precisely the same ground. As Justice Stewart then explained:
“The mere fact that § 9 is geared to appellants’ pricing policies in other States is not sufficient to invalidate the *587statute. As part of its regulatory scheme for the sale of liquor, New York may constitutionally insist that liquor prices to domestic wholesalers and retailers be as low as prices offered elsewhere in the country. The serious discriminatory effects of §9 alleged by appellants on their business outside New York are largely matters of conjecture. It is by no means clear, for instance, that § 9 must inevitably produce higher prices in other States, as claimed by appellants, rather than the lower prices sought for New York. It will be time enough to assess the alleged extraterritorial effects of §9 when a case arises that clearly presents them.” Joseph E. Seagram & Sons, Inc. v. Hostetter, 384 U. S. 35, 43 (1966).
Two decades have elapsed since those sentences were written. In the interim, Brown-Forman has been selling its products in more than 30 States, including New York. Yet at no time did it introduce any evidence tending to prove that New York’s ABC Law affected the price of its products in any other State.1
In lieu of evidence about the actual impact of the New York statute, the Court speculates that the ABC Law prevents price competition in transactions involving Brown-Forman’s products in other States. See ante, at 579-580, 582. This result is not a necessary consequence of the operation of the New York law. To begin with, so far as New York is concerned Brown-Forman may maintain its selling price in other States or may increase it — either is consistent with BrownForman’s promise to give New York wholesalers its “lowest price.” § 101-b(3)(d). Only if Brown-Forman reduces its *588prices outside of New York would it violate its affirmation. But in that event, the State allows it to extend the same discount to its New York customers “for good cause shown and for reasons not inconsistent with the purpose of this chapter.” § 101-b(3)(a).2 There is nothing in the record to suggest that the State Liquor Authority would ever object to a price reduction to conform to a lower out-of-state price, and it is counterintuitive to assume that it would. The whole purpose of the law, after all, is to provide New York consumers with the lowest prices that can be obtained. Consistent with this purpose, the State Liquor Authority has, in a similar situation, “offered to grant approval ... to offer a cash discount in New York equivalent to the product discounts [the distiller] would offer in other states.” Joseph E. Seagram & Sons, Inc. v. Gazzara, 610 F. Supp. 673, 678, n. 5 (SDNY), appeal docketed, No. 85-7547 (CA2, July 1, 1985). The administrative flexibility demonstrated by the State Liquor Authority thus belies the Court’s assumption to the contrary. See ante, at 582, n. 5. It also demonstrates the wisdom of the Seagram Court’s unwillingness to “presume that the Authority will not exercise that discretion to alleviate any friction that might result should the ABC Law chafe against” a provision of the Federal Constitution. Seagram & Sons, Inc. v. Hostetter, 384 U. S., at 46 (rejecting Supremacy Clause challenge predicated on federal antitrust laws). Cf. id., at 51. The presumption of constitutionality applied in Seagram not only accords with tradition — agencies are frequently charged with rectifying questionable applica*589tions of necessarily general rules — it is also consistent with the respect due state administrative organs responsible for the operation of a state law whose constitutionality is challenged on its face. Cf. United States v. Vuitch, 402 U. S. 62, 70 (1971).3 And if the State Liquor Authority were in fact to allow Brown-Forman to extend discounts given outside the State to its customers in New York, there is no reason to suppose that those other States would in turn refuse to allow Brown-Forman to credit the value of its promotional allowances against its list prices in order to comply with the statutory recording obligations in those States.4
*590Even if these open questions are all resolved in the Court’s favor, its conclusion that the ABC Law trenches on interstate commerce does not follow from Baldwin v. G. A. F. Seelig, Inc., 294 U. S. 511 (1935), the authority on which it primarily relies. Decided 30 years before Seagram, that case invalidated the New York Milk Control Act on the ground that it was designed to inflate milk prices in order to protect New York producers from out-of-state competition, see 294 U. S., at 519 — a classic illustration of economic provincialism.5 By contrast, the New York ABC Act was designed to keep the prices of liquor down in order to give New York consumers the benefit of out-of-state competition. See 384 U. S., at 38-39, and n. 9. The obvious infirmity of the statute struck down in Seelig thus says nothing about the constitutionality of the statute before us.
Moreover, as Judge Friendly observed, “[f]or some of us who were ‘present at the creation’ of the Twenty-First Amendment, there is an aura of unreality in [the] assumption that we must examine the validity of New York’s Alcoholic Beverage Control Law (ABC Law) just as we would examine the constitutionality of a state statute governing the sale of gasoline” — or, I would add, of milk. Battipaglia v. New York State Liquor Authority, 745 F. 2d 166, 168 (CA2 1984), cert. denied, 470 U. S. 1027 (1985). The statute in Seelig regulated an article of commerce that New York had no *591power to exclude from the State;6 the statute challenged here, in contrast, regulates the sale of a product that the Twenty-first Amendment expressly authorizes New York to exclude entirely from its local market.7 As Justice Stewart explained for a unanimous Court in Seagram:
“Consideration of any state law regulating intoxicating beverages must begin with the Twenty-first Amendment, the second section of which provides that: ‘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.’ As this Court has consistently held, ‘That Amendment bestowed upon the states broad regulatory power over the liquor traffic within their territories.’ United States v. Frankfort Distilleries, 324 U. S. 293, 299 [1945]. Cf. Nippert v. Richmond, 327 U. S. 416, 425, n. 15 [1946]. Just two Terms ago we took occasion to reiterate that ‘a State is totally unconfined by traditional Commerce Clause limitations when it restricts the importation of intoxicants destined for use; distribution, or consumption within its borders.’ Hostetter v. Idlewild Liquor Corp., 377 U. S. 324, 330 [1964]. See State Board of Equalization v. Young’s Market Co., 299 U. S. 59 [1936]; Mahoney v. *592Joseph Triner Corp., 304 U. S. 401 [1938]; Ziffrin, Inc. v. Reeves, 308 U. S. 132 [1939]; California v. Washington, 358 U. S. 64 [1958], Cf. Indianapolis Brewing Co. v. Liquor Comm’n, 305 U. S. 391 [1939]; Joseph S. Finch & Co. v. McKittrick, 305 U. S. 395 [1939].” 384 U. S., at 41-42.8
Of more recent vintage, see Capital Cities Cable, Inc. v. Crisp, 467 U. S. 691, 712-713 (1984); California Retail Liquor Dealers Assn. v. Midcal Aluminum, Inc., 445 U. S. 97, 110 (1980).
It may well be true that the network of statutes that have spread across the Nation since the Court’s decision in Seagram has created “so grave an interference with” interstate commerce as to exceed the “wide latitude for [state] regulation” under the Twenty-first Amendment and to make “the regulation invalid under the Commerce Clause.” 384 U. S., at 42-43. If that be the case, however, there should be ample evidence available to a concerned litigant to prove that this consequence has in fact developed. Until that is done, I believe we have a duty to adhere to the ruling in Seagram. Accordingly, I respectfully dissent.

 The record does show that Brown-Forman’s promotional allowances “effectively lowered the price to wholesalers in Massachusetts below the affirmation price in New York” in a manner “designed to circumvent the New York State Alcoholic Beverage Control Law.” App. to Juris. Statement 51a. This evidence, however, surely does not provide any basis for distinguishing this case from the Seagram case.

 The Connecticut statute invalidated on its face in United States Brewers Assn., Inc. v. Healy, 692 F. 2d 275 (CA2 1982), summarily aff’d, 464 U. S. 909 (1983), had no escape clause. See 692 F. 2d, at 276-277, nn. 3, 5, 6, and 7. The Second Circuit panel construed the Connecticut statute “to control the minimum price that may be charged by a non-Connecticut brewer to a non-Connecticut wholesaler in a sale outside of Connecticut.” Id., at 282.

 This discussion indulges the Court’s unstated assumption that price changes are not preceded by sufficient lead time to comply with the 35-day notice provision of the ABC Law. Again, however, there is nothing in the record to indicate that Brown-Forman has ever found it necessary to make a price change that could not be preceded by sufficient notice. Amicus curiae Wine & Spirits Wholesalers of America, Inc., informs us that the 18 States with liquor monopolies “perhaps typically” require suppliers “to warrant that quoted prices will remain in effect for a minimum of 90 days.” Brief for Wine and Spirits Wholesalers of America, Inc., as Amicus Curiae 9, n. 6. If, as a result of such contracts, prices in this industry are changed quarterly or at other infrequent intervals and are normally preceded by an announcement that the effective date of the change will be two or more months in the future, the statute would not have any inhibiting effect whatsoever on Brown-Forman’s pricing decisions.

 “In making this argument, appellant assumes, and properly so, that other States will enforce their liquor laws. But appellant also requires us to assume that other States will enforce their laws without regard for reality, and this we are unwilling to do.
“. . . It is certainly reasonable to expect that other States will recognize that the prices on appellant’s New York schedules have been adjusted, because of New York’s statutory requirements, to take into account the effect of credits enjoyed by wholesalers elsewhere — credits which the other States receiving the tangible benefits of appellant’s program apparently have already chosen not to consider in determining the affirmed price.
“. . . It would require us to engage in mere speculation were we to declare, on such a tenuous basis, the lowest-price affirmation statute *590unconstitutional as applied.” 64 N. Y. 2d 479, 489-490, 479 N. E. 2d 764, 769-770 (1985) (citations omitted).
Moreover, such possible consequences in States other than New York would seem to provide as good a reason for invalidating those States’ laws as it does for striking down New York’s statute.

 Seelig had purchased milk from Vermont farmers at a competitive price — instead of the New York regulated price — and was therefore denied a license to resell that milk in New York. Baldwin v. G. A. F. Seelig, Inc., 294 U. S., at 520. As Justice Cardozo explained, Seelig “may keep his milk or drink it, but sell it he may not.” Id., at 521.

 “New York has no power to project its legislation into Vermont by-regulating the price to be paid in that state for milk acquired there. So much is not disputed. New York is equally without power to prohibit the introduction within her territory of milk of wholesome quality acquired in Vermont, whether at high prices or at low ones. This again is not disputed.” Ibid.

 New York’s ABC Law complies with the letter and spirit of the Twenty-first Amendment. The New York law imposes a condition precedent to importation of liquor into the State pursuant to the literal terms of the Amendment, and it does so “for the purpose of fostering and promoting temperance in th[e] consumption [of alcoholic beverages] and respect for and obedience to the law.” § 101-b(l). Cf. Bacchus Imports, Ltd. v. Dias, 468 U. S. 263 (1984).

 The Court’s Twenty-first Amendment analysis, unsupported by any citation to authority, appears to be at war with itself. I simply cannot understand how the Twenty-first Amendment gives New York no right to condition access to its market on compliance with a “lowest price” affirmation (because to do so affects liquor sales in other States), and yet at the same time gives other States authority “to purchase brands of liquor that are sold in New York.” Ante, at 585. By reading the Twenty-first Amendment broadly to encompass any interstate regulation of liquor, but removing the constitutional shield when the faintest economic ripples begin to flow outside state borders, the Court has, at least in the interdependent national liquor market in which Brown-Forman participates, gutted the constitutional provision.