Wine and Spirits Fair Dealing Act
Encyclopedia
The Wine and Spirits Fair Dealing Act, also known as the Wirtz Law was an infamous Illinois
state law passed in 1999 that prevented distillers
and wineries from changing distributors without "just cause". Distributors stated that the law was required to prevent producers from severing ties with Illinois distributors and "outsourcing" their deals, ostensibly resulting in thousands of job losses throughout the state. After the law was passed, all Illinois distributors raised their prices. The Federal Trade Commission
actively lobbied against the law, to no avail.
The unofficial "Wirtz Law" name comes from the fact that the law was passed after Judge and Dolph distributor owner Bill Wirtz
and other distributors contributed over $700,000 to Illinois state legislators. Editorials at the time decried the law as a "corrupt document".
The law, (and the related Beer Industry Fair Dealing Act which dated to 1982), resulted in a popular Michigan
microbrewer, Bell's Brewery
, pulling their products from the Illinois market entirely in protest. Ultimately the unpopular law only remained on the books for three years before it was struck down by a U.S. District Court judge who said that it violated the commerce clause
of the Constitution
. The law and its history went on to become a case study for campaign finance reform
.
Bell's re-entered the Chicago market in 2007 via two new distributors by creating two new beer brands, Kalamazoo Royal Amber Ale and Kalamazoo Hopsoulution. Since each beer avoided the use of the "Bell's" name and logo, and used a different recipe from previous Bell's brands, Larry Bell contended that these are not the same beers that were assigned to his former distributor. Nevertheless, Bell stated at the time that he expected "to be sued by his former distributor, National Wine & Spirits." Initially, only the Royal Amber Ale was made available, in draft only, at about a dozen Chicago-area locations. In August 2008, Bell's returned its primary brands to the Chicago area in 2008 after National Wine & Spirits' exit from Illinois.
Illinois
Illinois is the fifth-most populous state of the United States of America, and is often noted for being a microcosm of the entire country. With Chicago in the northeast, small industrial cities and great agricultural productivity in central and northern Illinois, and natural resources like coal,...
state law passed in 1999 that prevented distillers
Distillation
Distillation is a method of separating mixtures based on differences in volatilities of components in a boiling liquid mixture. Distillation is a unit operation, or a physical separation process, and not a chemical reaction....
and wineries from changing distributors without "just cause". Distributors stated that the law was required to prevent producers from severing ties with Illinois distributors and "outsourcing" their deals, ostensibly resulting in thousands of job losses throughout the state. After the law was passed, all Illinois distributors raised their prices. The Federal Trade Commission
Federal Trade Commission
The Federal Trade Commission is an independent agency of the United States government, established in 1914 by the Federal Trade Commission Act...
actively lobbied against the law, to no avail.
The unofficial "Wirtz Law" name comes from the fact that the law was passed after Judge and Dolph distributor owner Bill Wirtz
Bill Wirtz
William Wadsworth "Dollar Bill" Wirtz was the chief executive officer and controlling shareholder of the family-owned Wirtz Corporation. He was best known as the owner of the Chicago Blackhawks of the National Hockey League, who are part of Wirtz Corp's holdings...
and other distributors contributed over $700,000 to Illinois state legislators. Editorials at the time decried the law as a "corrupt document".
The law, (and the related Beer Industry Fair Dealing Act which dated to 1982), resulted in a popular Michigan
Michigan
Michigan is a U.S. state located in the Great Lakes Region of the United States of America. The name Michigan is the French form of the Ojibwa word mishigamaa, meaning "large water" or "large lake"....
microbrewer, Bell's Brewery
Bell's Brewery
Bell's Brewery, Inc. is a brewery located in Kalamazoo, Michigan and currently brewed in Comstock, Michigan. Bell's Brewery produces the Bell's brand of beers. Bell's also has a brewpub called the Eccentric Cafe which serves their beer and food....
, pulling their products from the Illinois market entirely in protest. Ultimately the unpopular law only remained on the books for three years before it was struck down by a U.S. District Court judge who said that it violated the commerce clause
Commerce Clause
The Commerce Clause is an enumerated power listed in the United States Constitution . The clause states that the United States Congress shall have power "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." Courts and commentators have tended to...
of the Constitution
United States Constitution
The Constitution of the United States is the supreme law of the United States of America. It is the framework for the organization of the United States government and for the relationship of the federal government with the states, citizens, and all people within the United States.The first three...
. The law and its history went on to become a case study for campaign finance reform
Campaign finance reform
Campaign finance reform is the common term for the political effort in the United States to change the involvement of money in politics, primarily in political campaigns....
.
Bell's re-entered the Chicago market in 2007 via two new distributors by creating two new beer brands, Kalamazoo Royal Amber Ale and Kalamazoo Hopsoulution. Since each beer avoided the use of the "Bell's" name and logo, and used a different recipe from previous Bell's brands, Larry Bell contended that these are not the same beers that were assigned to his former distributor. Nevertheless, Bell stated at the time that he expected "to be sued by his former distributor, National Wine & Spirits." Initially, only the Royal Amber Ale was made available, in draft only, at about a dozen Chicago-area locations. In August 2008, Bell's returned its primary brands to the Chicago area in 2008 after National Wine & Spirits' exit from Illinois.