Washington Brewers Sue Oregon to Allow DTC and Self-Distribution in High Stakes Case
In what could be a pivotal and landmark court case, three brewers in Washington state have filed a lawsuit against the state of Oregon seeking to ship beer directly to consumers (DTC) and self-distribute to retailers in Oregon.
The three breweries filing the suit are Mirage in Seattle, Vancouver-based Fortside Brewing Co. and Garden Path Fermentation in Burlington.
The well-known “Granholm decision” (Granholm v. Heald, 544 U.S. 460), in 2005, was a court case decided by the US Supreme Court which ruled that laws in New York and Michigan that permitted in-state wineries to ship wine directly to consumers but prohibited out-of-state wineries from doing the same were unconstitutional.
Oregon law allows in-state breweries to self-distribute beer to licensed retails but prohibits out-of-state breweries from doing the same. To sell beer in Oregon, out-of-state breweries must use a licensed Oregon distributor. Oregon also allows in-state brewers to ship beer directly to the doorstep of consumers. The Washington brewers are arguing that allowing these distribution rights only for in-state brewers is counter to Granholm and violates the Commerce Clause of the U.S. Constitution.
Many states prohibit out-of-state brewers to self-distribute to retailers while allowing in-state brewers to do so. This will be a closely watched case in the industry, pitting beer wholesalers against brewers and potentially in-state brewers against out-of-state brewers in the evolving issue of access to retailers and direct shipping to consumers.