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

PETITIONER: Brown-Forman Distillers Corporation
RESPONDENT: New York State Liquor Authority
LOCATION: Dow Chemical

DOCKET NO.: 84-2030
DECIDED BY: Burger Court (1981-1986)
LOWER COURT: New York Court of Appeals

CITATION: 476 US 573 (1986)
ARGUED: Mar 03, 1986
DECIDED: Jun 03, 1986

ADVOCATES:
Lloyd E. Constantine - on behalf of the appellee
Macdonald Flinn - on behalf of the appellant

Facts of the case

Question

Media for Brown-Forman Distillers Corporation v. New York State Liquor Authority

Audio Transcription for Oral Argument - March 03, 1986 in Brown-Forman Distillers Corporation v. New York State Liquor Authority

Warren E. Burger:

We will hear arguments next in Brown-Forman Distillers against New York State Liquor Authority.

Mr. Flinn, I think you may proceed whenever you are ready.

Macdonald Flinn:

Mr. Chief Justice, and may it please the Court, this is an appeal from a judgment by the New York State Court of Appeals.

That court held that the lowest price liquor affirmation requirement of New York's alcoholic beverage control law does not violate the commerce clause of the U.S. Constitution.

On this appeal, Brown-Forman argued that the statute is unconstitutional upon its face because its necessary effect is the extraterritorial regulation by New York of liquor prices in other states.

New York effectively sets the minimum price for liquor sales in every state in the Union.

The New York statute--

Byron R. White:

It does it by setting the... by requiring the filing of prices in New York and telling them not to vary, telling them it can't be... it can't be higher than any place else.

Macdonald Flinn:

--Yes, Justice White, that is correct.

The statute works this way.

Last Tuesday, for example--

Byron R. White:

It really doesn't say what the prices have to be in some other state.

Macdonald Flinn:

--New York does not set the price.

That is conceded, Justice White.

The supplier initially determines his own price for each brand which he offers for sale to New York suppliers.

It is at that point that the New York statute reaches in and obligates him, mandates that he not for an extended period of time, the posting period, charge any lower price in any other state, having filed that price in New York.

The statute works this way.

On the 25th of every month, every supplier must file or post a schedule of prices to be charged for all of us products sold to New York wholesalers during the next following month.

Last Tuesday, all suppliers had to file an affirmation and a schedule of prices.

It would cover all of their sales for the month of April of this year.

All sales to New York wholesalers must be at those explicit posted prices, neither higher nor lower.

The statute also prohibits the price discrimination or difference in prices charged to one New York wholesaler as compared with other New York wholesalers.

Finally, as a condition of the right to sell to New York wholesalers, the New York statute, as Justice White indicated, obligates every supplier to adhere to that price once posted in New York during the entire calendar month that is covered by the posting requirement.

Every month every supplier must go through this affirmation process again.

The language of the statute and the affirmation or verification form employed by the state liquor authority are essentially in the same identical language.

If the Court will indulge me for a moment, I would like to read the explicit salient provisions of the statute.

It required that the New York posted price must be no higher than the lowest price at which each item of liquor will be sold anywhere in any other state at any time during the calendar month for which such schedule shall be in effect.

Byron R. White:

Do you think that is really a promise?

When you file, you promise now to lower your prices in any other state?

Macdonald Flinn:

It is in just that form, Justice White.