This post follows up on an earlier
post written about the same case.
Tennessee law imposes a residency requirement on individuals
(and companies) wishing to operate retail liquor stores in TN, requiring
applicants to have resided for the prior 2 years (for a new license), or 10
years (for a renewal); and if the applicant is a corporation, all its
shareholders must reside in TN.
In a 7-2 decision released on June 26th, the Supreme Court
ruled this Tennessee law is unconstitutional according to the Commerce Clause. The decision
is a win for liquor companies and consumers, who will no longer be subject to
state protectionist policies (supported by the Tennessee Wine and Spirit
In its opinion, the Court concluded that “far from granting
the States plenary authority to adopt domestic regulations, the Court’s
police-power precedents required an examination of the actual purpose and
effect of a challenged law.” Thus, the Court “reject[s] the Association’s
overly broad understanding” of the 21st Amendment, which the
Association argued gives states “virtually limitless authority” to regulate
In practice, the Court’s decision means that state
legislation may not impede interstate liquor trade unless the statute has a
“demonstrable connection” to “public health and safety effects of alcohol use
and to serve other legitimate interests.” It should be noted, however, that this
decision does not affect intrastate trade.
You can read the entire opinion here.