United States District Court, M.D. Tennessee, Nashville Division
CLAYTON BYRD in his official capacity as Executive Director of the TENNESSEE ALCOHOLIC BEVERAGE COMMISSION, et al., Plaintiffs,
TENNESSEE WINE AND SPIRITS RETAILERS ASSOCIATION, Defendant.
MEMORANDUM AND ORDER
H. SHARP UNITED STATES DISTRICT JUDGE.
before the Court is Defendant Tennessee Wine and Spirits
Retailers Association's (“Association”) Rule
56(d) Motion, (Docket No. 69), to which Plaintiff Tennessee
Fine Wines and Spirits, LLC (d/b/a Total Wine Spirits Beer
& More) (“Tennessee Fine Wines”) and
Plaintiff Clayton Byrd (“Byrd”) have filed
Responses in Opposition, (Docket Nos. 72 & 75). Rule
56(d) provides that “[i]f a nonmovant shows by
affidavit or declaration that, for specified reasons, it
cannot present facts essential to justify its opposition [to
a motion for summary judgment], the court may . . . take
discovery[.]” Fed.R.Civ.P. 56(d)(2). Defendant
Association moves the Court to grant it leave to conduct
discovery prior to responding to Plaintiff Tennessee Fine
Wines' Motion for Partial Summary Judgment, (Docket No.
55), and Plaintiff Affluere Investments, Inc.'s (d/b/a
Kimbrough Fine Wine & Spirits) (“Affluere”)
Motion for Preliminary Injunction, (Docket No. 63). For the
reasons set forth below, the Court will deny Defendant
threshold question in every federal case is whether the court
has the judicial power to entertain the suit.'”
Parsons v. U.S. Dep't of Justice, 801 F.3d 701,
709 (6th Cir. 2015) (citing National Rifle Assoc. of Am.
v. Magaw, 132 F.3d 272, 279 (6th Cir.1997)). Federal
courts may exercise jurisdiction only where there is an
actual “case or controversy.” See U.S.
Const. art. III, § 2. Justiciability doctrines, such as
“standing” and “ripeness, ” give
meaning to Article III's “case or
controversy” requirement. Magaw, 132 F.3d at
279. “Standing requires a litigant to have suffered an
injury-in-fact, fairly traceable to the defendant's
allegedly unlawful conduct, and likely to be redressed by the
requested relief.” Id. (citing Lujan v.
Defenders of Wildlife, 504 U.S. 555, 560-61 (1992)).
Where, as here, a party seeks declaratory relief, the Court
“must ask whether the parties have ‘adverse legal
interests, of sufficient immediacy and reality to warrant the
issuance of a declaratory judgment' even though the
injury-in-fact has not yet been completed.”
Id. at 280 (citations omitted). “Ripeness
requires that the ‘injury in fact be certainly
impending' . . . [and] separates those matters that are
premature because the injury is speculative and may never
occur from those that are appropriate for the court's
review.” Id. (citations omitted).
Association urges the Court to permit it to conduct discovery
on issues of standing and ripeness before responding to the
pending motions that go to the constitutionality of the
residency requirement under T.C.A. § 57-3-204(b)(2)(A).
In addition to the residency requirement, applicants for a
retail package store license must meet other conditions.
See Tenn. Code Ann. §
57-3-208(a)-(b)(1)&(2) (securing a location for the
business); Tenn. Code Ann. § 57-3-210(d) (not having
engaged in business in violation of any state's liquor
laws, rules, and regulations); Tenn. Code Ann. §
57-3-204(b)(2)(D) (being at least twenty-one years old);
Tenn. Code Ann. § 57-3-204(b)(2)(G) (not intending to
carry on the business as an agent of or on behalf of
Association argues that both Plaintiff Tennessee Fine
Wines' and Plaintiff Affluere's standing is called
into question because they may not have valid applications
for retail package store licenses. (Docket No. 70 at 6).
Defendant Association supports that argument by pointing to a
local newspaper report suggesting that Plaintiff Tennessee
Fine Wines no longer has a lease on the store location for
its business, (Docket No. 69-1), and to filings by Plaintiff
Affluere, (Docket Nos. 63-1 & 63-2), that suggest the
possible loss of the contract to purchase the store for its
liquor business. Furthermore, based off information found in
Plaintiff Tennessee Fine Wines' application to the
Tennessee Alcoholic Beverage Commission (“the
Commission”), Defendant Association believes that
Plaintiff Tennessee Fine Wines' structure and supposed
violations of other states' liquor regulations preclude
the Commission from granting it a license. Therefore,
Defendant Association requests discovery to determine if
evidence would establish that the Commission must deny
Plaintiffs' applications on statutory grounds other than
the residency requirement. Defendant Association also argues that
the constitutional challenge to the residency requirement
that Plaintiff Tennessee Fine Wines raises in its Motion for
Partial Summary Judgment would not be ripe if it is
ineligible for a retail package store license based on
another statutory ground.
Court disagrees with Defendant Association that it needs to
conduct discovery before responding to the Plaintiffs'
pending motions. With respect to standing, Defendant
Association's argument can be summed up as follows:
Plaintiffs do not have standing to challenge the residency
requirement unless the Commission would grant them a license
but for that requirement. However, that proposition is
contrary to established law. For example, in Ne. Florida
Chapter of Associated Gen. Contractors of Am. v. City of
Jacksonville, Fla., 508 U.S.656 (1993), a case in which
the plaintiff brought an equal protection challenge to a city
ordinance giving preferential treatment to minority-owned
businesses in awarding city contracts, the Supreme Court
When the government erects a barrier that makes it more
difficult for members of one group to obtain a benefit than
it is for members of another group, a member of the
former group seeking to challenge the barrier need not allege
that he would have obtained the benefit but for the barrier
in order to establish standing. The “injury in
fact” in an equal protection case of this variety is
the denial of equal treatment resulting from the imposition
of the barrier, not the ultimate inability to obtain the
benefit. . . . And in the context of a challenge to a
set-aside program, the “injury in fact” is
the inability to compete on an equal footing in the
bidding process, not the loss of a contract
U.S. at 666 (emphasis added). To establish standing, the
plaintiff in that case “need[ed] only [to] demonstrate
that it [was] able and ready to bid on contracts and that a
discriminatory policy prevent[ed] it from doing so on an
equal basis.” Id. Courts have applied
Florida Chapter's “equal footing”
doctrine to find standing where plaintiffs challenge state
laws they allege are discriminatory under the dormant
Commerce Clause. See Conservation Force, Inc. v.
Manning, 301 F.3d 985, 990 n.3 (9th Cir. 2002) (citing
Florida Chapter's “inability to compete on
an equal footing” as sufficient injury when nonresident
plaintiffs brought a dormant Commerce Clause challenge to
Arizona's cap on the percentage of hunting permits issued
to nonresidents); All. for Clean Coal v.
Miller, 44 F.3d 591, 594 (7th Cir. 1995) (stating, in
the context of a dormant Commerce Clause challenge to an
Illinois statute, that “the injury is not a particular
lost sale but the ‘inability to compete on an equal
in Maxwell's Pic-Pac, Inc. v. Dehner, 887
F.Supp.2d 733 (W.D. Ky.
aff'd in part, rev'd in part, 739 F.3d 936
(6th Cir. 2014), the district court found that plaintiffs had
standing to bring an equal protection challenge to an
allegedly discriminatory liquor licensing law. 887 F.Supp.2d
733, 742 (“The Intervening Defendant also argues that a
favorable decision from this Court would not redress the
alleged injury because it would not guarantee Plaintiffs
licenses to sell liquor and wine. Though this premise is
surely correct, the conclusion drawn from it mistakes the
nature of the alleged injury. The harm Plaintiffs suffer is
not that some retailers have licenses while they do not; it
is that Plaintiffs cannot apply for licenses on the same
footing as other retailers.”).
Florida Chapter, Plaintiffs need not prove that they
“would . . . obtain the benefit [of a retail package
store license] but for the barrier [of the residency
requirement] in order to establish standing.” 508 U.S.
at 666. Rather, for standing purposes, they need only show
that they are “able and ready” to apply for a
retail package store license and “that a discriminatory
policy prevents [them] from doing so on an equal
basis.” Id. The filings in this case support
Plaintiffs' readiness to apply for a retail package store
license. (Docket No. 1-1 at 4, ¶¶ 11-15; Docket No.
55-1 at 1-3, ¶¶ 3-15; Docket No. 63-1 at 1-2,
¶¶ 2-6). And the crux of the dormant Commerce
Clause challenge to the residency requirement is that it
allegedly impermissibly favors Tennessee interests, not
allowing non-residents to obtain a retail package store
license on equal footing as Tennessee residents.
respect to ripeness, the Court finds that the constitutional
challenge is ripe for decision. In order to determine if an
issue is ripe, the Court considers “the fitness of the
issues for judicial decision” and “the hardship
to the parties of withholding court consideration.”
Thomas v. Union Carbide Agr. Prod. Co., 473 U.S.
568, 581 (1985) (internal quotation marks and citation
omitted). The Court agrees that the constitutional challenge
meets the fitness requirement because “[t]he issue
presented in this case is purely legal, and will not be
clarified by further factual development.” Union
Carbide, 473 U.S. at 581. Furthermore, the Court agrees
that “denying prompt judicial review would impose a
substantial hardship” on Plaintiffs, Susan B.
Anthony List v. Driehaus, 134 S.Ct. 2334, 2347 (2014),
namely leaving them subject to the allegedly discriminatory
foregoing reasons, the Court hereby DENIES Defendant
Association's Rule 56(d) Motion, (Docket No. 69), for
leave to conduct discovery prior to responding to Plaintiff
Tennessee Fine Wines' Motion for Partial Summary
Judgment, (Docket No. 55), and Plaintiff Affluere's
Motion for Preliminary Injunction, (Docket No. 63). Defendant
Association has twenty-one (21) days from entry of ...