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February 2015 Wines&Vines 17 wine industry news 15 $1,885 6 the Grapes! to reconcile the state's DtC shipping statutes with court rulings on FWC v. Jenkins. The FWC v. Jenkins case con- tended the DtC shipping statutes in Massachusetts had capacity-cap provisions that discriminated against "larger wineries." The statutes only allowed win- eries producing 30,000 gallons of wine or less to obtain a permit to sell wines in Massachusetts—and only in one of three ways: directly to consumers, through wholesal- ers or through retailers. Larger wineries had to choose between using a wholesaler and obtaining a permit to direct ship to Massachusetts consumers. They could not use both methods, cut- ting them off from the important wholesale market. They also could not sell wines directly to retailers. All of Massachusetts' wineries are smaller than 30,000 gallons, and the law effectively blocked most wine produced out of state. The U.S. District Court in 2008 and the U.S First Circuit Court of Appeals in 2010 declared that these statutes violated the Commerce Clause of the U.S. Constitution. In addition to accepting direct shipping, the new law eliminated the unworkable "consumer aggre- gate" quantity limit that had been preventing even smaller wineries from making shipments. Previ- ously, each household could be shipped a quantity limit of 26 cases annually from all sources, which prevented wineries from shipping because they could not determine how much wine a household had received. The new regulations limit ship- ments from each winery to 12 cases annually, which is easy for the wineries to monitor. Under the new provisions of the bill, a winery holding a federal basic permit may obtain a Direct Wine Shipper License shipping permit for an initial fee of $300, with subsequent renewals costing $150 annually. DtC licensees may ship up to 12 cases of wine annu- ally to each adult resident of Mas- sachusetts. Annual reporting is required online using MassTax- Connect, as is payment of excise taxes but not sales tax. An early concern with the new Massachusetts wine-shipping law was that it required common car- riers to license each and every truck that delivers wine. A bill to allow common carriers to obtain a fleet license for the delivery of alcohol is pending in the Massa- chusetts legislature, but Federal Express has licensed trucks to start delivering wine in Massachusetts starting Feb. 1. Wine Institute's long effort to open the state included on-the- ground legislative advocacy driven by Wine Institute north- eastern counsel Carol Martel and local lobbyist Bob Rodophele under Steve Gross' direction. Jer- emy Benson and the team at Free the Grapes! orchestrated an effec- tive publicity campaign to support the effort. Former New England Patriots quarterback Drew Bledsoe, who now owns Doubleback Winery in Washington state, contributed sig- nificantly to the effort. —Paul Franson WINE INSTITUTE