"What's California Gonna Do About It?"

California's unconstitutional spirits shipping law invites contempt

Yesterday, the California Assembly’s General Administration committee met to consider extending a “temporary” unconstitutional distiller shipping law. The Committee approved the bill unanimously. This bill (AB1088) is going to become law.

Yes. the bill that allows California’s craft distillers to continue to ship products directly to California consumers is unquestionably unconstitutional because it discriminates against out-of-state distillers by barring them from shipping to California consumers.

The bill extends through 2024 the ability of California craft distillers to ship directly to consumers a limited amount of spirits. This is the third time California has passed temporary direct shipping privileges for California distilleries. The first temporary measure came in the early days of COVID as a means of helping distilleries survive the pandemic shutdown.

In 2022 there was an effort to make permanent direct shipping privileges and that bill, SB 620, would have, properly, allowed both in-state and out-of-state distillers to ship to California consumers. However, the effort eventually died as a result of controversies over whether or not large distillers ought to be able to ship to Californians. So, the California legislature will extend the “temporary” and unconstitutional spirits shipping provision to continue to allow California distillers to continue to ship to California consumers.

What’s notable is that the bill currently under consideration in the California Assembly and that will surely become law actually contemplates a lawsuit being filed due to its discriminatory feature barring out-of-state distiller shipping and, therefore, violating the U.S. Constitution’s dormant Commerce Clause. The bill analysis provided to all members of the Committee that heard the bill yesterday says this: