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Letting winemakers breathe

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Andrew Edwards

Newport Beach vintner Richard Moriarty is not yet able to ship cases

of his Back Bay Cuvee all across the country, despite last week’s

Supreme Court ruling against two states’ laws that prohibited him

from selling his product directly to customers.

Moriarty is waiting to see how other states react to the court’s

decision. Last Monday, the court issued a 5-4 ruling that Michigan

and New York laws banning direct sales from out-of-state wineries

illegally discriminated in favor of in-state producers, who were

allowed to make direct online sales to customers.

The court ruled states can ban direct wine sales, but must treat

in-state and out-of-state wineries equally. The case was sent back to

lower courts for future action.

Moriarty and other California vintners can make direct sales to

consumers in the 26 states that allow the practice, according to the

Wine Institute, a San Francisco-based group that lobbies for

California wineries.

Currently, most wine from Moriarty’s Newport Beach Vineyards &

Winery is sold within a 5-mile radius of his Back Bay vineyard. But

if other states’ laws become more favorable, he may send more bottles

further away.

“We probably will ship more,” Moriarty said. “New legislation

obviously gives us more opportunities.”

Like Moriarty, others are playing the waiting game.

“It’s really positive to begin with, as to how different states

are going to act remains to be seen,” said Albert Paul, vice

president of sales and marketing for Bianchi Vineyards. Bianchi

Vineyards is a Paso Robles winery with sales offices in Newport

Beach.

Lobbyists representing wineries view the court’s ruling as a tool

to pry open the legal barriers blocking California vintners from

making direct sales. The Supreme Court only considered Michigan and

New York laws. However, Steve Gross of the Wine Institute said he

thinks other states will be forced to reconsider laws governing wine

shipments.

“We can use this [ruling] for momentum,” Gross said.

A loosening of wine shipping laws could be a short-term problem

for retailers, said Dan Rhodes, a buyer for Hi-Time Wine Cellars in

Costa Mesa. If customers can buy a wider variety of wine without

having to visit stores, retailers like Hi-Time may receive smaller

shipments from suppliers.

In the long run, Rhodes said wine sellers are hoping complicated

rules that govern how they are allowed to do business from state to

state will be simplified.

“That’s going to be the next phase of this thing,” Rhodes said.

Wholesalers, on the other hand, will likely try to limit direct

sales, Paul said. On the day of the ruling, Wine & Spirits

Wholesalers of America -- a trade organization representing alcohol

wholesalers -- issued a release in support of a three-tiered system

that requires vintners to sell to wholesalers, who in turn provide

wine to retailers.

For now, Moriarty is looking forward to harvesting this year’s

harvest . Tiny clusters of green grapes are already growing along his

vineyard, and he credits the winter rains for what could be an

exceptional crop.

“This is just uncanny; this is months -- at least a month, ahead,”

Moriarty said as he examined a grape cluster.

* ANDREW EDWARDS covers business and the environment. He can be

reached at (714) 966-4624 or by e-mail at andrew.edwards

@latimes.com.

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