December 5, 2002 - San Francisco Chronicle: India and Iran RPCV David Lucas is leader of "Free the Grapes" Movement
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December 5, 2002 - San Francisco Chronicle: India and Iran RPCV David Lucas is leader of "Free the Grapes" Movement
India and Iran RPCV David Lucas is leader of "Free the Grapes" Movement
Read and comment on this story from the San Francisco Chronicle on RPCV David Lucas, who served in the Peace Corps in both India and Iran, and the movement he is leading to "Free the Grapes" at:
Lodi vintner strives to break down barriers to wine shipping*
* This link was active on the date it was posted. PCOL is not responsible for broken links which may have changed.
Lodi vintner strives to break down barriers to wine shipping
Carol Emert Thursday, December 5, 2002
David Lucas, a small Lodi winemaker, is a plaintiff in the big direct- shipping lawsuit now on appeal in New York -- arguably one of the most important wine industry cases ever to appear in court.
Yet Lucas didn't attend a single hearing in the case, in which New York's ban on wine shipments from out of state was recently declared unconstitutional.
He has never even met his lawyers, who are headquartered in Washington, D.C.
"I wanted to, but either I was in Indonesia surfing or in the middle of harvest or something," says Lucas, 60, who has been an activist in some form or other for much of his adult life.
Lucas' true passion is creating a California Zinfandel as elegant as the best Burgundys and Bordeaux. He even custom-designed his fermentation tanks at Lucas Winery to show his 79-year-old Zinstar vineyard grapes to their best advantage.
But Lucas -- who celebrated the Nov. 12 ruling by taking his girlfriend, winemaker Heather Pyles, out for Thai food -- is also an interesting local window on the string of legal battles over wine shipments now raging in federal courts around the country.
He is one of the 35 or so winemakers and consumers who have stepped forward to serve as plaintiffs, putting a human face on the battle over shipping restrictions.
With six lawsuits in the works and a seventh, in Indiana, that ruled against direct shipping, the goal is to get a definitive ruling by the U.S. Supreme Court.
Lucas is clearly enjoying his role -- although his participation does carry some risk.
"It was really fascinating just watching how it works," Lucas says. "It really works! Of course, I guess you always say that when you win."
Lucas learned of the ruling in a phone call from his lawyer, Steve Simpson of the Institute for Justice, a libertarian legal group that fights for a range of issues including school vouchers and an end to affirmative action.
"I went outside and walked around about four of five feet off the ground, which was an interesting experience," says Lucas. Weeks later, he says he's "still, oh, about a foot and a half off the ground."
Lucas has become something of a minicelebrity in Lodi. He appeared on local television after the ruling and has been fielding congratulatory calls from other vintners -- and extra orders from appreciative customers.
"This morning I went over to Mondavi (his former employer) to return some yeast I borrowed, and everybody in the lab went 'Yay!' when I walked in," he says. "This is really good for everybody."
Right now Lucas' business is too small, about 3,000 cases per year, to need a distributor in New York. But he's been warned that he's unlikely to ever find one willing to work with him.
Distributors, which supply retail stores, fear their business will suffer if consumers are free to order wine from wineries and have it FedExed to their homes.
Several distributors signed on as voluntary defendants in the New York case even though they were not sued. They have been hotly defending their turf around the United States.
Lucas was recruited to the case by California direct-shipping advocates and was one of about a dozen winemakers vetted by the Institute as potential plaintiffs.
He was able to demonstrate that he had been hurt by the direct-shipping ban by producing letters from New York customers trying to order wine and his written responses saying no.
"This really has hurt my business over the years," Lucas says.
The Institute also found Juanita Swedenburg of Swedenburg Winery in Middleburg, Va., whom lead attorney Clint Bolick knew because he had tried -- and failed -- to order wine from her.
The attorneys then had to find consumer plaintiffs in New York who could prove they had attempted to order wine from Lucas or Swedenburg and been refused.
"Every once in a while the right case walks in our door, but it's very very rare," says Bolick, who developed a passion for wine while attending law school at UC Davis in the early 1980s. Usually the case has to be more or less constructed to find just the right combination of plaintiffs, he says.
While Lucas didn't attend any of the hearings, he spent many tedious hours digging through files and answering subpoenas from the primary defendant, the New York attorney general.
In one instance, the attorney general's office used the fact that Lucas' wines hadn't won any awards to make a case that they aren't any good and therefore not saleable in New York. "So I had to respond saying we don't enter contests," Lucas says.
Lucas shipped his documents to the East Coast in two wine cases.
Lucas, who grew up in the San Fernando Valley, was a Peace Corps volunteer in India and Iran after college. For awhile he made surf boards for a living.
Lucas started his Lodi winery in 1977 and began focusing on it full time about six years ago. Through most of the 1980s and '90s he worked in vineyard management for Mondavi's Woodbridge business in Lodi.
Lucas has been involved in Free the Grapes, a direct-shipping advocacy group and was a pioneer in sustainable agriculture.
While Judge Richard Berman declared New York's direct-shipping law unconstitutional, it's not clear whether the state will one day be open to out- of-state wine shipments.
Berman found that New York's policy is discriminatory because it lets in- state wineries ship to consumers, but not out-of-state ones. He will hear arguments Dec. 10 on whether both should be allowed or both should be banned.
This creates a dilemma for Attorney General Eliot Spitzer -- the same guy who has been in the limelight this year for taking on Wall Street ne'er-do- wells. Spitzer has said he will consult with the legislature and Gov. George Pataki before taking a position.
But historically the two have been split on shipping; the Assembly passed a bill similar to California's in 1995 that would have ended the ban on out-of- state shipments, but Pataki vetoed it.
If Spitzer has political ambitions beyond the attorney general's office, as is believed, he risks alienating New Yorkers if he supports a total ban on direct shipping. Both Riesling-sipping Manhattanites and the state's up-and- coming wine industry are sure to be ticked off.
The wholesaler defendants are pushing for an all-out ban, but at this stage it's not at all clear that the attorney general's office agrees, say Institute lawyers. New York wineries are lobbying hard for Spitzer to endorse open shipping.
Says Spitzer spokesman Brad Maione, "Essentially the governor is our client.
Whichever avenue he decides to pursue, we pursue."
Send news, tips and information to Carol Emert at firstname.lastname@example.org.
Learn more about Free the Grapes
Learn more about the "Free the Grapes" movement at their web site at:
Free the Grapes
A national wine war is pitting consumers-- who want the option of having wineries ship directly to them-- against wine wholesalers, who are threatening winemakers and citizens with jail time if they bypass the middlemen.
Interstate wine shipments using a common carrier, from a winery to an adult consumer 21 years or older, are prohibited in the following 28 states, and a felony for wineries, retailers and non-basic permit holders in states with an asterisk: AL, AZ, AR, DE, FL*, GA*(very limited shipping allowed if a winery has no wholesaler), IN*, KS, KY*, ME, MD*, MA, MI, MS, MT, NC*, NJ, NY, OH, OK, PA, SC, SD, TN, TX, UT, VT, VA.
A decade ago, just four states allowed for interstate direct shipments. Now, that number has increased to 22 states. But 28 states still prohibit interstate shipments, and seven states have made interstate direct shipments a felony. In some states, the penalty for a burglary conviction is equivalent to that of shipping a bottle of Chardonnay to an adult over 21 years.
Why are consumers angry?
* Each vintage, more wines are produced than are represented by wholesaler middlemen, or can be sold in retailer outlets. The number of U.S. wineries increased by over 500% to 2,100 in the past 30 years. U.S. wineries produce over 10,000 new wines each vintage, but nearly all wineries are small producers; 2,050 of America's wineries produce less than 5% of U.S. wine production. And less than 17% of U.S. wineries are represented by distributors in all 50 states.
* And consumer demand for these fine wines is thriving. Consumers expect to be able to purchase the wines they want, in the manner of their choosing: from retailers, at the winery, and remotely by telephone, fax, and online.
* But wholesaler middlemen seek to protect their state-sanctioned monopolies. The number of wholesalers decreased by over 75% during the same 30-year period. Now, two or three wholesalers alone determine what wines are available in their state.
The Model Direct Shipping Bill satisfies consumer demand for choice in wines and how they are delivered, satisfies regulatory requirements and creates a new source for state sales tax revenues. Interstate direct shipments are estimated to be less than 1% of total wine purchases. This model bill has been successfully implemented in New Hampshire, Louisiana and Wyoming.
Millions of wine enthusiasts, regulators and tax collector officials in states that have passed favorable legislation (NH, LA, WY), as well as America's 2,100 mostly family-owned winery farms located in all 50 states, support limited, regulated direct-to-consumer shipments.
What are consumer supporters doing to support the cause? Citizens and winery plaintiffs have worked together to sue six states: New York, Texas, Florida, North Carolina, Virginia and Michigan. (For more information on the legal foundation coordinating these lawsuits visit the Coalition for Free Trade website.) Through Free the Grapes!-- which serves to translate consumer frustration into constructive action-- wine lovers have written thousands of letters to state legislators, met with legislators, and voiced their opinions through the media. Consumer support has encouraged legislators to introduce bills in numerous states, prevented a felony bill in Texas from becoming law, and turned a felony bill into a pro-shipping law in North Dakota.
Wine wholesalers (aka distributors) and their national trade association, the Wine & Spirit Wholesalers of America.
"Most of the wines that are unavailable beyond the states in which they are made are expensive, but wine lovers, and there are a lot of them, don't want their choices dictated by a few distributors."
New York Times, June 25, 2000
"The [wholesaler] industry's tactics are a civics lesson in how scare stories, lobbying and political money can be used to limit consumer choice through special-interest protections."
USA TODAY, July 7, 1999
"Wholesalers have been playing the underage drinking card to protect their monopoly."
Wall Street Journal, April 5, 2002
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FACTS AND FIGURES
FACT: Distributors can't logistically stock and sell the 10,000 new wines produced each year by America's 2,100 wineries.
* 30% of all products stocked in the average supermarket would need to be wine to display one bottle of each wine.
* A single row of lined-up wine bottles would stretch for nearly one-half mile.
FACT: Less than 5% of wine production is ever likely to be shipped direct to consumers.
* The top 50 U.S. wineries produce over 95% of all wine produced in the U.S.
* Over 2,100 wineries located in all 50 states, mostly family-owned and operated, produce less than 5%, or an average of under 10,000 cases each.
* But this is not an issue exclusive to small wineries. Large wineries also blend special, small production lots which the current system cannot adequately sell.
* Well-aged "library" wines are often only available from the winery or retailer.
* The majority of specialty imports, like Bordeaux "futures," are purchased and sold by a handful of East Coast retailers.
FACT: Distributors want exclusive control of the wines consumers can and cannot purchase, and are going to extreme measures to maintain their state-sanctioned monopolies.
* In 1999, state wholesalers in Texas aggressively supported a bill that carried the same penalty for shipping a bottle of wine illegally to a Texas adult consumer as the penalty for assault with a deadly weapon. Fortunately, the bill was not signed into law by then Governor George W. Bush.
* Distributors forced through legislation, making it a felony for winemakers to ship any amount of wine directly to wine lovers in Kentucky, Maryland, Florida and Georgia (except in compliance with House Bill 1273).
* Florida's key wholesalers have virtually eliminated competition by setting legal requirements which prevent the formation of new, small distributorships:
o Maintain minimum $100,000 in inventory;
o Actively service 25% of all accounts in their county-- that is, staffed to sell to convenience stores-- even though fine wine specialists account for just 5-10% of all accounts
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MYTH VS. REALITY
MYTH: "Direct shipping will increase underage access and Internet abuse."
REALITY: Government officials have gone ON RECORD that underage access is not and has not been a problem in legal shipping states. Wineries know they have a responsibility to avoid underage access, and always support adult signature at delivery.
MYTH: "Wineries want to avoid paying state taxes."
REALITY: Wineries support provisions allowing for state tax payments--recently passed legislation and the Model Direct Shipment Bill includes these provisions (e.g., LA, NH, NV)
MYTH: "Americans are overwhelmingly opposed to the direct shipment of alcohol beverages."
REALITY: The vast majority of letters and opinion are pro-consumer, pro-direct shipment.
MYTH: "What's at stake is a fundamental breakdown of law and order…"
REALITY: Wineries must have a Federal permit to operate. Any violation of state law may be reported to the BATF for federal action.
* Source: Wine & Spirits Wholesalers of America (www.wswa.org)
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