Florida Orange Groves, Inc.
1500 Pasadena Ave. South
St. Petersburg, Florida 33707
October 3, 2002
Donald S. Clark
COMMENTS REGARDING E-COMPETITION
Dear Mr. Clark;The current restrictions imposed on the wine industry (and on manufacturers of wine in particular) as they relate to Internet sales and to interstate Internet sales are nothing more than attempts by distribution monopolies at destroying competition, availability, consumer choice and price comparisons on wine products. One needs only to review the article Vintage System in the October 4, 1999, Wall Street Journal (a copy [PDF 646KB] of which is included with the hard copies of this letter) to fully understand the extent and character of their efforts.
The purpose of these laws, enacted by state legislators after receiving campaign contributions from their various alcoholic beverage distributors, is to affect interstate competition not just in favor of a defendant state but to affect it in favor of a state sanctioned alcoholic beverage distributor's monopoly. These laws openly and intentionally discriminate against interstate commerce and free trade -- both intrastate and interstate. The discrimination is present on the face of the laws and in the discriminatory affect arising as a natural consequence of the passage of these laws.
In our state of Florida, these restrictions are destroying efforts at the development of an entirely new industry for the state. We manufacture a unique line of citrus wines, made and available nowhere else in the world. Can we advertise on the Internet that we can ship to consumers elsewhere in the United States? No. Why? Because of restrictions put on interstate shipments of wine at the behest of the distributors -- many of who control distribution in not just one but several states! These laws deny us the necessary contact with our customers that is positively essential to new industry development and to free trade.
There are even far more severe consequences for our state. The citrus industry is desperate for uses of grapefruit juice. The state agriculture industry is desperate to find alternative crops for tobacco farmers to grow. A healthy alternative wine industry would solve these and many other problems. While California has over 1,000 wineries, Florida now has just 11. We are third or first (depending which study you read) in the consumption of wine and virtually last in its production. A viable wine industry in Florida would provide immense revenue to the state, new employment and new uses of existing agricultural products. Internet sales restrictions help prevent this new industry from creating the awareness so essential to its development and success. The state's entire economy and new agricultural industry development is thus negatively affected just to protect what? A few distributors with campaign contributions. Make no mistake, this is by design and intent, just as is documented in the attached Wall Street Journal article.
Arguments about protecting the safety of minors with Internet sales restrictions of alcoholic beverages are so false in their basis as to almost be not worthy of comment. I am not aware of any state ever having had a case of a minor receiving wine by common carrier unless someone in the state's Attorney General Office first provided the minor with a credit card, told them who and when to call, had them lie to the seller and shipper about their age and then arranged for the minor to be present at home at the time of delivery after waiting weeks for receipt. This "safety issue" is patently false. It is an effort at deliberate discrimination against and the overly burdening of interstate commerce, masquerading as a state's exercising its police powers to safeguard its citizens.
Concerns about the collection of state alcoholic beverage taxes are also false. All wineries stand ready to assist states in any way that is legal and constitutional to collect the taxes that are due. To imply that the development of a collection system is not feasible and just denies the existence of the technology available today.
We are either going to have the Internet be a free market exchange of economic information and products or we are going to let it become a marketing device carved up by special interests based on their campaign contributions to local, state or federal politicians. Please let it be the former by invalidating all interstate and intrastate restrictions on Internet sales. The resulting positive economic effect just on Florida's emerging wine industry alone would justify your actions. Help us to compete and to build our country's, and our state's, economy at a time when we, its citizens, need it most. Please end all intrastate and interstate Internet sales restrictions.
Vincent R. Shook