44 Liquormart Inc V Rhode Island
Submitted by cassie1909 on 06/30/2008 05:21 PM
- Category: Business
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44 Liquormart Inc V Rhode Island
The State of Rhode Island has strict laws prohibiting the advertising of alcoholic beverage prices outside of the stores where the alcohol is sold. A local merchant, 44 Liquormart, Inc., ran an advertisement in the local newspaper displaying the prices of various items; such as, peanuts, potato chips, and drink mixers. The advertisement also pictured various brands of liquor and the word "WOW" next to the picture. The Rhode Island Liquor Control Administrator considered the advertisement a violation of state law, and assessed a fine of $400 to 44 Liquormart, Inc. Rhode Island's state law supports the ban on the promotion of temperance because it is believed that the promotion of alcoholic beverages would increase the sale of alcohol and level of alcohol consumption. 44 Liquormart paid the fine, and filed suit in the Federal District Court claiming that "the Rhode Island off-premise advertising law was in violation of the First Amendment's free speech protection."(Corley, 2001)
The District Court reviewed various studies regarding alcohol advertising and its affect on the level of alcohol consumption, and found no correlation between the two. There was evidence indicating that Rhode Island had a high level of alcohol consumption despite the state's effort to ban its promotion. "Rhode Island ranks in the upper 30% of states in per capita consumption of alcoholic beverages, alcohol consumption is lower in other states that allow price advertising." (Corley, 2001) Therefore, it was concluded that the price advertising ban was unconstitutional and judgment was awarded to 44 Liquormart.
However, the Court of Appeals found "inherent merit in the States submission,"(Corley, 2001) and reversed the decision. It was believed that competitive price advertising would lower prices and increase sales.
The Supreme Court reviewed the rulings from the lower courts. After review, the court determined that the price advertising ban was in violation of the...
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