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Virginia vintner takes on NY courts

Virginia vintner takes on NY courts – Va. direct shipping law ruled unconstitutional

Elisabeth Frater

Virginia vintner Juanita Swedenburg was familiar with conflict long before she became the lead plaintiff in Swedenburg v. Kelly, the latest crusade against state laws that ban direct shipping of out-of-state wine. Decades before she filed the lawsuit or testified at a deposition, Juanita and her husband Wayne were members of the United States Foreign Service. Diplomatic tours of duty took them to perilous corners of the world, including the then-French colonies in Southeast Asia and Africa. Given that plucky past, it isn’t surprising that Swedenburg took on the New York State Liquor Authority–and won.

On Nov. 12, in a victory for wine consumers, Judge Richard M. Berman of the Southern District of New York ruled that the state’s direct shipping law is unconstitutional.

What prompted Juanita’s legal battle? A simple desire to ship Swedenburg Estate Vineyard’s Burgundian-style Chardonnay and plush Pinot noir to a far-flung, but loyal fan base. “We have many visitors from up north and New York State,” she says from the winery overlooking their bucolic farm and vineyard in Virginia’s hunt country.

Customers wanted Swedenburg wines shipped to them once they were home, Juanita explains. With a hint of passion in her voice, she tells of her awakening to the fact that interstate shipping of wine to New York was illegal. “I began to get cross about it and then began to fuss.”

The law at stake prohibited out-of-state wineries from selling directly to New York residents, and instead required them to use state-authorized wholesalers. For small vintners like the Swedenburgs, that was not viable. Higher costs meant higher prices for their customers, and left the Swedenburgs unable to compete with the home state wineries.

The deeper Juanita dug into the issue, the more absurd the laws seemed. “We are a nation of law breakers,” she maintains. “We are all carrying wine across state lines.” Yet, nobody wanted to do anything about changing the law. “No one in Virginia wanted to pursue it,” she says.

By way of illustration, Juanita tells about a seminar on interstate shipping and her confrontation of an Alcohol and Beverage Control representative. “We have all the wines in our stores that our consumers need,” the ABC spokesman told her. “In other words,” Wayne Swedenburg says, “he was saying the bureaucracy knows more than the common man.”

So how did Juanita jump from the tank room into the courtroom? It was through local customer Clint Bolick, a well-regarded attorney for the Institute for Justice in Washington, D.C. Fortuitously, he specializes in cases dealing with individual liberty, free market solutions and limited regulation.

“Clint came here for years and bought wine. When I discovered what he does, I said, ‘I have an issue for you. Then I began to pester him.” She adds, “I had to fuss at him for five years.”

Bolick became convinced that Juanita had a viable challenge to the law for two reasons. First, Bolick and his small legal team determined that the laws in New York, the nation’s second-largest wine market, were “blatantly designed to preserve the monopoly by which wholesalers control the distribution and sale of all out-of-state wine.” Second, Juanita Swedenburg was an ideal plaintiff because she had clean hands: she had never shipped wine to New York customers in violation of the law.

Swedenburg v. Kelly, filed on Feb. 3, 2000, challenged New York state’s ban on direct shipment of wine and advertising by out-of-state wineries to New York consumers. The case was based on several principles found in the U.S. Constitution: the right to engage in interstate commerce, the right to earn an honest living in other states on the same terms and conditions as the residents of those states and freedom of speech.

Juanita tells of the courtroom dramas she witnessed over the two-and-a-half years before Judge Berman’s favorable ruling. At one point there were eight teams of lawyers, including those representing the wholesalers, pitted against the Institute for Justice. Big legal names like failed Supreme Court nominee Robert Bork and C. Boyden Gray, the former White House counsel under president George Bush, argued in defense of the state law.

In one of the more interesting moments, a lawyer for the wholesalers argued that rat poison would end up in wine bottles and that middle school students would buy liquor over the Internet if Juanita prevailed.

In the end, the fussing paid off. “These gigantic wholesalers who are used to having their way never met anyone like Juanita Sweden-burg,” Bolick says. “She is feisty and courageous, and that is a winning combination.”

Ironically, the lawsuit was never intended to increase the demand for their wines or expand their customer base. “We are small enough that we can concentrate on a small quantity,” Juanita says. “But we run out of things all the time.”

Judge Berman’s ruling in Juanita’s case has followed the lead of courts in Texas, Illinois, Virginia and North Carolina that have blocked similar statutes. But other courts have upheld state bans on direct wine shipments.

RELATED ARTICLE: About Swedenburg Estate

When Juanita Swedenburg retired from the Foreign Service in 1 976, she and her husband Wayne bought the 130-acre Valley View Farm with the intention of returning to their farming roots and raising Angus cattle.

In most respects the farm is pure Virginia. It is just outside the quaint town of Middleburg, with its century-old stone fences and vintage inns. The gentle slopes of the Swedenburgs’ farm roll away from Highway 50 to the edge of the Little River, which winds into Goose Creek and then on to the Potomac.

Juanita and Wayne arrived at winemaking through an indirect path. “We knew that if you have land you had to maintain it and pay the taxes, “Juanita explains. So, after a disastrous attempt at growing corn, they tried grapes.

They studied Thomas Jefferson’s vineyard notes, visited wineries near New York’s Finger Lakes and some in Virginia, including Piedmont Vineyards, Rapidan River (now part of Prince Michel) and Barboursville Vineyards.

But it proved difficult to get their hands on the proper vines. California vines were out of the question because of the threat of soil-borne pests such as phylloxero or nemotodes. “Initially we got vines from Michigan and New York” and from Rausse, Juanita says.

They consulted official soil maps to determine the most advantageous part of the farm to plant, taking into account airflow and water drainage.

“We learned very quickly that we were blessed with the same soils that are in the grape growing areas of France, calciferous limestone soil,” Wayne says. He hastens to add: “Not all of Virginia is blessed with the type of soil we have in the Piedmont. Closer to the Potomac you have clay.”

Utilizing topographical maps, they planted in rows oriented north to south with 5-foot by 10-foot spacing. Juanita says newer plantings will be 2 to 3 feet by 9.

Their Chardonnay, Cabernet Sauvignon, Pinot noir, Seyval blanc and Riesling vines now occupy 15 acres. Juanita tends them and serves as the winemaker, while Wayne oversees the winemaking equipment. Production ranges from 2,000 to 2,500 cases annually.

Their philosophy in the cellar is modeled after the yin de garagistes in France. Like the French, they produce wines that retain the essence of the fruit and without the detectable presence of oak. Since 1987, after Wayne finally retired, they have been bottling their own wines.

“Of course traveling around the world for so many years gave us an advantage,” Juanita says. “We knew good wine, we were able to recognize good wine and we knew what it takes to make good quality wine. We weren’t just old farmers, or tobacco farmers converting over to another agriculture entity.”

Wayne chuckles at the thought. “We were brought up on ’48 ’49 and ’51 and ’53 vintages, some of the greatest vintages in France. And they were so reasonably priced in those days.”

Strange Bedfellows: Bordeaux and Cucamonga

Robert Mondavi teaming up with the Rothschild clan to produce a high end, bi-national wine venture, we can understand. Seems logical enough. A good match.

But what’s a member of the famous Lurton family of Bordeaux doing, teaming up with a winemaker from a relatively obscure winemaking region like Cucamonga? Plenty.

Gino Filippi, owner of Filippi Winery in Rancho Cucamonga, made the trek across the Atlantic recently to visit the ancestral home of winemaker Marc Lurton, owner of Chateau Reynier in Entre-Deux-Mers.

The pair of unlikely associates was introduced by an American lawyer friend and longtime business associate of both families, who thought the two men had a lot in common. Lurton came from a family with a distinguished history of winemaking in one of the world’s top wine producing regions, while Filippi was a fourth generation California winemaker in a region with some of the state’s oldest and most revered Zinfandel and Grenache vines. Lurton wanted to get his feet wet in American wine production and consulting, while Filippi longed for a taste of Old World winemaking.

Both men are fourth generation winemakers. Filippi’s great-grandfather, Giovanni Filippi, planted his first vineyard in Cucamonga in 1922, while different branches of Lurton’s large clan own more estates in Bordeaux than any other single family. (Chateau Bonnet, Brane-Cantenac, Clos Fourtet, Margaux, Climens, Durfort-Vivens, Bouscaut, and Le Louviere, to name just a few).

Without much ado, Filippi packed his bags last spring and went off for a month’s sojourn in Bordeaux as the guest of Lurton, to get a view of European winemaking at its best. (Filippi, who says, “I felt that had found a long-lost brother, and the few weeks I spent there have changed my life,” tells the warming story of his visit in his winery newsletter.)

The upshot of the visit was that both Lurton and Filippi were infused with the desire to collaborate on a winemaking venture, to be called “Deux Monds”, which will entail wines being made on two continents and marketed globally.

“We plan to make just two wines initially: one, a classic Bordeaux blend, will be made by Marc at Chateau Reynier and sold here. The other, for which we are considering a blend of old vine Zinfandel, Cabernet franc and Mourvedre, will be made here in Cucamonga by our winemaker, Justin Weibel, under Marc’s direction,” said Filippi. The two expect initially to produce about 1,500 cases of each.

Just in case the name “Weibel” rings a bell, Justin Weibel is also a fourth generation winemaker, scion of the Weibel Vineyards family in Woodbridge, fresh out of UC Davis and honing his skills at Filippi on Cucamonga old vine Zin. In addition to their new joint venture wines, Filippi will market Chateau Reynier wines here in California.

Lynn Alley (Elizabeth Frater is a freelance wine writer and author of the book Breaking Away to Virginia and Maryland Wineries. She is based in Washington, D.C. and can be contacted at edit@winesandvines.com.)

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