The National Association of Wine Retailers distributed the following press release today in support of the lawsuit I filed with Illinois attorney Sean O’Leary on Tuesday. NAWR describes itself as an organization that seeks “a level playing field for alcohol sales that matches the expectations of the modern consumer and addresses the 21st-century marketplace”—a principle this lawsuit seeks to advance in California.
For Immediate Release February 26, 2026
Wine Retailers Support Lawsuit Dismantling Protectionist Alcohol Laws
—National Association of Wine Retailers Supports Three-Tier Reforms—
SACRAMENTO, CA — The National Association of Wine Retailers (NAWR) is proud to support a recently filed lawsuit in the U.S. District Court for the Eastern District of California challenging the state’s protectionist and discriminatory wine distribution laws. The litigation comes at a moment when the wine industry is facing considerable challenges and needs the kind of reform this lawsuit will bring in order to face those challenges.
As described in Blue Sky Vineyards v. Tupy, the State of California gives its wine retailers the privilege of procuring inventory directly from the state’s wineries, bypassing middleman wholesalers. However, California law bans those same retailers from obtaining inventory directly from out-of-state wineries. The law is both protectionist and discriminatory. Not only are retailers in California denied access to hundreds of thousands of wines that wholesalers in the state do not distribute, but the law also harms out-of-state wineries, which are barred from interacting with California retailers in the same direct manner as California wineries.
The lawsuit is brought by Illinois’ award-winning Blue Sky Vineyards and The Wine Country, a renowned wine retailer located in Southern California. The Wine Country hoped to procure some of Blue Sky’s products to sell to its customers who look for unusual and diverse selections, but was prohibited from purchasing directly from the Illinois winery in the same way it can commonly do from California wineries. State law would require Blue Sky to work with a California-based wholesaler, who would have to purchase Blue Sky wines, then mark them up and sell them to The Wine Country. This would increase the cost to The Wine Country and put Blue Sky Vineyards at a competitive disadvantage versus California wineries.
“NAWR is committed to supporting efforts that level the playing field for all members of the industry and provide retailers with the means for better addressing consumer demand. We aim to bring consumers greater choice and access to products, and to help dismantle discriminatory and protectionist laws that serve only to gatekeep and rent-seek,” said Tom Wark, executive director of the NAWR.
Protectionist Wine Distribution Laws Common Across the Country
The discriminatory winery distribution law is one of many protectionist laws in states across the country that are relics of the archaic “three-tier system” of alcohol distribution that was written into law during the Great Depression nearly 100 years ago. Today, instead of protecting against producer monopolies and assuring efficient collection of taxes as originally intended, they serve as devices to protect profits and market control of goliath middlemen wholesalers.
“This kind of violation of the Constitutional principle that states may not impose discriminatory barriers to interstate trade when there are non-discriminatory alternatives remains too common and harms both the alcohol beverage marketplace and ultimately consumers,” noted Wark. “NAWR believes middlemen wholesalers play a key role in the alcohol marketplace, but that they don’t deserve nor need special protection from competition.”
ABOUT NAWR NAWR is a national organization of wine merchants ranging from brick-and-mortar stores to online retailers as well as auction houses and wine clubs. It seeks to protect its members’ interests by seeking a level playing field for alcohol sales that matches the expectations of the modern consumer and addresses the 21st-century marketplace. For more information see: www.nawr.org
