UNITED STATES SUPREME COURT DECISIONS ON-LINE

U.S. Supreme Court

Brown-Forman v. N.Y. State Liq. Auth., 476 U.S. 573 (1986)

Brown-Forman Distillers Corp. v. New York State Liquor Authority

No. 84-2030

Argued March 3, 1986

Decided June 3, 1986

476 U.S. 573

APPEAL FROM COURT OF APPEALS OF NEW YORK

New York's Alcoholic Beverage Control Law (ABC Law) provides that a distiller, licensed to do business in the State, may not sell its products to wholesalers within the State except in accordance with a monthly price schedule previously filed with appellee State Liquor Authority, and requires that the distiller include with the schedule an affirmation that the prices in the schedule are no higher than the lowest prices that the distiller will charge wholesalers anywhere else in the United States during the month. Appellee determined that the ABC Law prohibited appellant distiller, which sells its liquor in New York and in other States, from offering certain promotional allowances (based on past purchases and projections of future purchases) to wholesalers in the State, and that the payment of the allowances to wholesalers in other States lowered the "effective price" of appellant's products to those wholesalers, thus violating the affirmation provision of the ABC Law. After license revocation proceedings were instituted against appellant, it sought review of appellee's ruling in the Appellate Division of the New York Supreme Court, which held, inter alia, that the affirmation provision did not, on its face, directly regulate interstate commerce in violation of the Commerce Clause of the Federal Constitution. The New York Court of Appeals affirmed.

Held:

1. The affirmation provision of New York's ABC Law, on its face, violates the Commerce Clause. Pp. 476 U. S. 578-585.

(a) In analyzing state economic regulation under the Commerce Clause, the critical consideration is the overall effect of the state law on both local and interstate activity. Pp. 476 U. S. 578-579.