Tannins of Indianapolis, LLC v. Beshear

CourtDistrict Court, W.D. Kentucky
DecidedDecember 28, 2021
Docket3:19-cv-00504
StatusUnknown

This text of Tannins of Indianapolis, LLC v. Beshear (Tannins of Indianapolis, LLC v. Beshear) is published on Counsel Stack Legal Research, covering District Court, W.D. Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tannins of Indianapolis, LLC v. Beshear, (W.D. Ky. 2021).

Opinion

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF KENTUCKY LOUISVILLE DIVISION

TANNINS OF INDIANAPOLIS, LLC et al., Plaintiffs,

v. Civil Action No. 3:19-cv-504-DJH-CHL

DANIEL CAMERON,1 in his official capacity as Attorney General of Kentucky, and ALLYSON COX TAYLOR, in her official capacity as Commissioner of the Department of Alcoholic Beverage Control, Defendants.

* * * * *

MEMORANDUM OPINION AND ORDER

Kentucky law prohibits out-of-state retailers “in the business of selling alcoholic beverages” from shipping or delivering alcohol directly to consumers in the Commonwealth. See Ky. Rev. Stat. § 244.165(1). In-state retailers, however, can deliver alcohol directly to consumers so long as they obtain the appropriate license. See id. § 243.240(1)(b) (authorizing the holder of a “quota retail package license” to “[d]eliver to the consumer . . . alcoholic beverages that are purchased from the licensed premises”). Plaintiffs Tannins of Indianapolis, LLC; Jack Bailey; Steven A. Bass; and David Kittle challenged the constitutionality of this statutory scheme, claiming that it violated the Commerce Clause and the Privileges and Immunities Clause of the United States Constitution. (Docket No. 33, PageID # 169–70) The Court granted the Kentucky attorney general’s motion to dismiss the plaintiffs’ second amended complaint for failure to state a claim (D.N. 53), and it later dismissed the remaining claims against the commissioner of the Department of Alcoholic Beverage Control for the same reason. (D.N. 55) The plaintiffs now

1 Per Federal Rule of Civil Procedure 25(d), Cameron is automatically substituted for his predecessor, Andrew G. Beshear. move for an order altering or amending the Court’s dismissal of their case. (D.N. 56) For the reasons explained below, the Court will deny the plaintiffs’ motion. I. Plaintiff Tannins of Indianapolis, LLC is an Indiana-based wine retailer operated by Plaintiff Bailey.2 (D.N. 33, PageID # 171) Tannins sells some of its wines online and ships them

directly to customers throughout the country. (Id.) Yet it cannot sell and ship wine directly to interested customers in Kentucky because Kentucky law makes it “unlawful for any person in the business of selling alcoholic beverages in another state or country to deliver or ship or cause to be delivered or shipped any alcoholic beverage directly to any Kentucky consumer who does not hold a valid wholesaler or distributor license issued by the Commonwealth.” Ky. Rev. Stat. § 244.165(1). Tannins could potentially acquire a license permitting it to make direct-to-consumer wine deliveries in Kentucky if it maintained a physical presence in the Commonwealth, but Tannins “has no business reason to establish physical premises in Kentucky [and] cannot afford to do so.” (D.N. 33, PageID # 172) Plaintiffs Bass and Kittle are wine consumers who wish to

purchase wine from Tannins and other out-of-state retailers and have those wines shipped to their residences in Kentucky. (Id., PageID # 173–74) Such interstate wine orders, however, are likewise prohibited by Kentucky law. (Id., PageID # 174 (citing Ky. Rev. Stat. § 244.165)) The plaintiffs brought this action under 42 U.S.C. § 1983, alleging that the Kentucky laws that ban direct-to-consumer wine deliveries by out-of-state retailers yet permit such deliveries by in-state retailers “discriminat[e] against interstate commerce and protect[] the economic interest

2 The facts provided here come from the plaintiffs’ second amended complaint (D.N. 33), which the Court dismissed for failure to state a claim (D.N. 53; D.N. 55). In dismissing the second amended complaint, the Court accepted the plaintiffs’ well-pleaded factual allegations as true (D.N. 53, PageID # 250), and it does the same for purposes of the present motion. of local businesses by shielding them from competition, in violation of the Commerce Clause of the United States Constitution.” (Id.) They also claimed that the laws “den[ied] [Plaintiff] Bailey the privilege to engage in his occupation in the Commonwealth upon the same terms as Kentucky citizens” in violation of the Privileges and Immunities Clause. (Id., PageID # 176) Kentucky’s attorney general, one of the official-capacity defendants in this matter, filed a

motion to dismiss the plaintiffs’ second amended complaint in May 2020 (D.N. 47), which the Court granted (D.N. 53). In its order granting the attorney general’s motion, the Court observed that the Sixth Circuit’s decision in Lebamoff Enterprises Inc. v. Whitmer, 956 F.3d 863 (6th Cir. 2020), cert. denied, 141 S. Ct. 1049 (2021), “resolved a question strikingly similar to the one” raised in the plaintiffs’ case. (Id., PageID # 252) And because the plaintiffs “ha[d] pleaded no facts to distinguish” their case from Lebamoff, that decision, the Court concluded, foreclosed their Commerce Clause claim. (Id., PageID # 254) The Court also dismissed the plaintiffs’ Privileges and Immunities Clause claim because they conceded that recent changes to Kentucky law rendered it moot. (Id.; see D.N. 49, PageID # 231) The Court then dismissed the plaintiffs’ remaining

claims against the commissioner of the Department of Alcoholic Beverage Control in a separate order (D.N. 55) after the plaintiffs further conceded that “if it [wa]s appropriate to dismiss the complaint against [the attorney general], it [wa]s appropriate to dismiss the complaint against [the commissioner] also on the same grounds.” (D.N. 54, PageID # 256) The plaintiffs now move pursuant to Federal Rule of Civil Procedure 59(e) for an order altering or amending the Court’s dismissal of their second amended complaint. (D.N. 56) The plaintiffs ask the Court to vacate its grant of the attorney general’s motion to dismiss, reopen their case, and “allow the parties to present evidence in support [of] or opposition to [Kentucky’s] purported justification for discriminating against out-of-state wine retailers.” (Id., PageID # 260) In the alternative, they ask the Court to amend its dismissal order to provide that their case was dismissed without prejudice and to grant them leave to file a third amended complaint. (Id., PageID # 263) The commissioner and the attorney general both filed responses opposing the plaintiffs’ motion (D.N. 59; D.N. 60), and the plaintiffs replied (D.N. 61). II.

A. Federal Rule of Civil Procedure 59(e) permits a district court to “alter or amend a judgment” that has already been entered, including an order dismissing a case for failure to state a claim. See Fed. R. Civ. P. 59(e); see also Fed. R. Civ. P. 41(b) (“Unless the dismissal order states otherwise . . . any dismissal not under this rule—except one for lack of jurisdiction, improper venue, or failure to join a party under Rule 19—operates as an adjudication on the merits.”). But relief under Rule 59(e) “constitutes an extraordinary remedy reserved for exceptional cases.” Skyworks, Ltd. v. Ctrs. for Disease Control & Prevention, No.

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Bluebook (online)
Tannins of Indianapolis, LLC v. Beshear, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tannins-of-indianapolis-llc-v-beshear-kywd-2021.