Federal Court to Hear Arguments on Illinois State Liquor Laws

After a federal judge dismissed efforts by out-of-state interests to upend Illinois’ liquor laws last year, a three-judge panel is set to hear an appeal challenging the state’s direct-to-consumer shipping laws. Under current Illinois law, alcohol retailers who wish to sell to Illinois consumers must obtain a license and go through the state’s three-tier system to deliver or ship directly to consumers.

Alleging that state laws which prohibit residents from receiving wines from Indiana liquor stores are unlawful, Cap n’ Cork owners Lebamoff Enterprises filed suit in September of 2016. They argued that Illinois statutes requiring that all retailers of alcoholic liquor be licensed in Illinois creates an undue burden upon interstate commerce.

U.S. District Court Judge Samuel Der-Yeghiayan, ruled that the state’s statutes are consistent with past precedents, current law, and re-affirmed the importance of the three-tier system.

The Wine and Spirits Distributors of Illinois joined the Illinois Attorney General’s brief asking the 7th Circuit Court of Appeals to affirm the district court’s ruling and reaffirm Illinois’ three-tier regulatory system.

Karin Lijana Matura, Executive Director of the Wine and Spirits Distributors of Illinois said, “Existing Illinois law allows for the safe and responsible delivery of alcohol to adult consumers and any attempt to bypass these laws in the interest of profits for out-of-state retailers is unacceptable. Illinois retailers offer thousands of different products delivered to consumers safely within the three-tier system.”

Matura noted that while the direct shipping law has been in place since 2008, recent efforts to combat rampant noncompliance – including changing the penalty from a business offense to a Class 4 felony – caught the attention of out-of-state retailers who had previously been shipping into Illinois without licenses and without paying taxes.

“Unlike some states, including Indiana, Illinois does not have a durational residency requirement, meaning that a business can open operations here without first having to establish personal residency to receive the proper licenses,” added Matura. “Illinois is open for business to those who wish to abide by the established laws that have been in place for years to, above all else, protect the safety of our citizens.”

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