SB 608 ruled unconstitutional by state Supreme Court

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  •  State law could dramatically changed the way alcohol is distributed in the Sooner State.
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OKLAHOMA CITY – A closely divided Oklahoma Supreme Court last week struck down a state law that could have dramatically changed the way alcohol is distributed in the Sooner State.

By a vote of 5-4, the state’s high court said the provisions of Senate Bill 608 violated the Oklahoma Constitution. The bill, which was passed last year, required the top 25 alcoholic beverages by sales in Oklahoma to be sold equally to any alcohol wholesaler in the state.

Justices Noma Gurich, Richard Darby, James Winchester, James Edmondson, and Jon Reif voted in favor of the ruling. Justices Yvonne Kauger, Matthew John Kane, Deborah Barnes, and Jerry Goodman dissented.

“The Legislature’s authority to impose such a requirement comes from the constitutional provision itself wherein it requires the Legislature to enact regulatory laws regarding alcoholic beverage sales,” Kauger wrote in her dissent.

“The crux of this cause is that the proposed Legislation does nothing more than adding a requirement that the top brands be made available to everyone. Adding a top brand requirement to what manufacturers and winemakers have to offer does not change the function, the meaning, or the mandate of the voter approved provision. Consequently, the law should be upheld as constitutional. If anything, it furthers the purpose of the legislation regarding sales within the heavily regulated alcoholic beverage industry and levels the playing field.”

Though the measure was signed into law by Republican Gov. Kevin Stitt, it never went into effect because it was ruled unconstitutional by Oklahoma County District Judge Thomas Prince.

Writing for the majority, Justice Winchester said the law violated the Oklahoma Constitution.

“The court must always presume that a law is constitutional unless ‘clearly, palpably and plainly inconsistent with the Constitution,’” the court’s majority ruling said. “Here, SB 608 is clearly, palpably and plainly inconsistent with (Oklahoma’s constitutional) grant of discretion to a liquor or wine manufacturer to determine what wholesaler sells its product.”

Business officials praised the court’s ruling. A statement from the Oklahoma State Chamber of Commerce said businesses should be allowed to operate without government red tape.

“If a supplier wishes to utilize one wholesaler, they should be free to do so without government’s red tape,” State Chamber CEO Fred Morgan said. “Senate Bill 608 represented a law that no one wanted or needed, and we are glad the state Supreme Court affirmed the lower court’s ruling by declaring it unconstitutional.”

The ruling comes at the same time Oklahoma’s retail liquor industry is struggling. Data from the Oklahoma Alcoholic Beverage Laws Enforcement Commission shows the number of retail liquor stores continues to decline.

According to the commission, Oklahoma had 617 licensed liquor stores at the end of 2019, down from 649 a year before.

“There was an average of 683 the three years prior (2015- 2017), which was before the passage and implementation of SQ 792; the alcohol ‘modernization’ bill authored by Sen. Stephanie Bice and former Sen. Clark Jolley,” a social media posting by the Oklahoma Retail Liquor Association related.

Those numbers, the association said, represented a loss of 34 local businesses in just a single year and more than twice that many in the last two years.

“Nearly one out of every 10 liquor stores has closed down since December of 2017. We anticipate the loss of local liquor stores to continue at the current pace, about 2.5 per month, until there are fewer than 400 stores left statewide,” the group said.

“These businesses and jobs are not being replaced. The money they generated is being absorbed by large out-of-state corporations like Walmart, which spent nearly $5 million to get ‘alcohol modernization’ written and passed.”

Oklahoma lawmakers will return to the state Capitol on Feb. 3 for the 2020 legislative session.