For Immediate Release March 23, 2020

National Association of Wine Retailers Executive Director Tom Wark Issued the Following Statement on the Wine and Spirits Marketplace and the Covid-19 Outbreak

—A Call To Set Aside Self-Serving Politicking In Favor of A Rational Response to A Human and Marketplace Emergency—

(Sacramento, CALIF)—If ever there was a moment that demonstrated both the utility and necessity of allowing consumers to receive shipments of wine from out-of-state wine retailers, it is now, as we isolate and require Americans to migrate even more of their lives into an online setting. In fact, we now know that it’s not just a matter of convenience, modern supply chain economics, and free trade principles that underscore the need for interstate wine shipment laws, but it’s also a matter of health and safety.

The industry and political forces that have long opposed this obvious and necessary evolution in wine distribution—from exclusively local retail sales to interstate access to an unprecedented diversity of products—have long been understood as making self-serving arguments for closed, state-based markets that uphold artificial protections from competition. It’s never surprising when these anti-diluvian, yet well-heeled, groups try to make the case for pretending it’s 1940 and not 2020.

However, what is shocking is their attempt to manipulate the current health crisis to advance a long held agenda to stop interstate shipments of wine to consumers all for the sake of maintaining a place of privilege in the alcohol beverage marketplace.

Consider the text and subtext of a recent letter sent to America’s governors from Michele Korsmo, the president and CEO of the Wine & Spirit Wholesalers of America (WSWA) — the organization in the United States most responsible for spreading the gospel of anti-consumer, draconian, archaic, self-serving laws meant to protect middleman wholesalers’ bottom lines at the expense of the interests of consumers and the economic expansion of the alcohol beverage industry:

“If closures of these [retail alcohol] stores across localities or states occur inconsistently, there is an increased chance that people will travel interstate or among localities to find an open store with available supply, increasing risk of spread among communities. Closing down regulated stores for consumers to access alcohol will likely encourage black market activity – specifically, illicit products and illegal, unlicensed, and untraceable sales and shipments from unknown locations to consumers.”

While making the obvious call to allow wine retailers to stay open during the COVID-19 crisis for curbside pickup, Ms. Korsmo justifies this self-evident policy with the fearmongering claim that it must be done to discourage “black market activity” that originate from parts unknown.

In fact, if you asked Ms. Korsmo for clarification as to what is meant by “illicit products and illegal, unlicensed, and untraceable sales and shipments from unknown locations to consumers.” she won’t point you to the “moonshiner” in the hills pumping out pure grain alcohol. Nor is she urging governors to prevent unlicensed individuals from setting up as illegal alcohol vendors. No. Ms. Korsmo is seeking to prevent the entirely safe practice of interstate alcohol shipments from licensed retailers; of consumers finding the products they want online and having them shipped to them via common carrier from outside the state where they reside.

For years, even decades, middleman wine wholesalers pleaded with states, lawmakers and courts to prevent consumers from buying wine directly from wineries and having it shipped to their homes, claiming it would destroy the carefully balanced alcohol distribution system, while not mentioning the fact that this now common practice only hurt the wholesalers’ bottom line. They lost that argument in the court of public opinion and in the courts of law.  Now Ms. Korsmo and the wholesalers she represents are working to shut down wine shipments from out-of-state retailers by using the fearmongering and the current health crisis to advance the middlemen’s financial interests. It’s cringeworthy.

American wine wholesalers, who occupy a privileged place in the middle of the so-called “Three Tier System”, have never been known for making the principled argument for the maintenance of their privilege. But no one expected them to so blatantly use one of the most severe health crises in U.S. history to advance their protectionist, anti-consumer agenda of requiring wine drinkers to only have access to products wholesalers distribute in the state where consumers reside.

Ms. Korsmo ends her self-serving missive disguised as “advice” to America’s governors this way:

“WSWA is ready to offer more extensive guidance, if desired, regarding practices that will ensure market needs are met, jobs are secure, and black market / unlicensed liquor sales are not given an avenue to thrive.”

Every piece of “guidance” the WSWA has offered over the past 25 years when it comes to consumer rights and consumer access to products has called for fewer rights for consumers, less access to products by consumers, and trapping wine retailers in a middleman-controlled, analog world as everything around them migrates to a digital existence.

There is no “black market” for wine in the United States and there has not been for over 80 years. There is no current or coming tsunami of unlicensed liquor sales occurring in the United States. The emergence of the COVID-19 Virus and the contraction of social interaction will not provide these non-existent things an “avenue to thrive”.

The wine and spirit wholesalers in America along with Ms. Korsmo should call for policy changes that will benefit real people and real businesses, rather than fearmongering in order to pad their bottom line and protect them from having to compete in a modern economy.

Today, every single state in the Union ought to be enabling consumers and help them to stay safe by passing legislation to allow the receipt of wine shipments from both in-state and out-of-state wine retailers and wineries in a well-regulated way. Every state should allow curbside pickup. Such policies should be obvious to anyone who is concerned not with the protection from competition that wine wholesalers demand, but rather with the health of the American economy and American consumer.

The National Association of Wine Retailers is urging American wine and spirit wholesalers and their representatives to muster the strength to not use the current crisis to pad their bottom line at the expense of health, safety, and American consumers.

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Tom Wark, Executive Director
[email protected] • (971) 332-5057