Can states ban certain wine parcels?

When Prohibition was repealed in 1933, state governments were granted an extraordinary power - the authority to ban alcohol within their borders.

It is a power that no state, acting alone, had possessed under the US Constitution until passage of the 21st Amendment.

Now, more than 70 years later, that authority is at the center of a US Supreme Court battle that could change the face of the liquor industry, opening the door for widespread direct-to-customer sales over the Internet.

At issue is the scope of state power to regulate alcohol. Tuesday, the high court takes up three consolidated cases examining whether Michigan and New York have the authority to enforce state regulations that favor in-state wine producers.

If the dispute involved any other legal product - from cheese to washing machines - clearly the answer would be no. The US Constitution's commerce clause establishes and protects a national common market, mandating free interstate trade.

But because of the fallout from America's failed 13-year experiment in temperance, alcohol retains a special status within the Constitution. That is why the 50 states have 50 different ways of regulating alcohol.

Although the 21st Amendment gives the states that power, it isn't clear how far the power extends.

On one side are Michigan, New York, and 33 other states arguing that the 21st Amendment gives them near total control over alcohol - including the authority to enforce regulations that may create certain hardships for out-of-state producers.

On the other side are producers, potential consumers, and free-trade advocates. They acknowledge the state power to regulate alcohol, but they say that power must be wielded on an evenhanded basis so that whatever restrictions or benefits apply to in-state producers must also restrict or benefit out-of-state producers.

"States can prohibit [alcohol] altogether or permit it on whatever terms they wish. The one thing they cannot do, in our view, is discriminate based on the [out-of-state] origin of the product," says Clint Bolick, a lawyer with the Institute for Justice, which is representing a group of out-of-state wine producers.

The affected states disagree. "Nothing in the text of the 21st Amendment limits the states in how they may choose to set up their regulatory framework to deal with the transportation, importation, and distribution of alcoholic beverages," says Michigan Solicitor General Thomas Casey in his brief to the court.

How a majority of justices resolve the issue could be worth billions of dollars to the liquor industry. If the high court strikes down state restrictions that discriminate against out-of-state producers, it would probably mean lower prices and more selection for consumers.

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