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Small Wineries Find Ally On Interstate Shipping

Starr and his colleagues at the law firm of Kirkland & Ellis, followed by Sullivan, helped the plaintiffs match the wholesalers' high-priced legal talent, which includes such prominent names as former federal judge Robert H. Bork and former White House counsel C. Boyden Gray.

According to its 2002 federal tax statement, the most recent available, the Coalition for Free Trade spent more than $1.1 million between 1998 and 2001. It is seeking an additional $700,000 in donations, according to W. Reed Foster, its president.


Virginia winemaker Juanita Swedenburg is one of the parties to the suit seeking to overturn laws barring direct interstate wine sales. (Tracy A. Woodward -- The Washington Post)

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In the wine industry, Jackson's decision to back litigation was seen as risky and, by some, as courageous. Many other winemakers feared retaliation from wholesalers.

The biggest name in the wine business publicly supported the Indiana state law at the 7th Circuit. E.&J. Gallo Winery, with an estimated $3 billion per year in retail sales, according to MKF Group, filed a friend-of-the-court brief defending the statute -- a move that was widely seen as a reflection of Gallo's good relationships with the wholesalers.

Gallo has filed no other briefs. Asked the company's position on the Supreme Court case -- Granholm v. Heald, MI Beer & Wine Wholesalers v. Heald and Swedenburg v. Kelly, 03-1116, 03-1120 and 03-1274 -- Gallo spokesman John Segale said: "We believe this is an issue that needs to be resolved by the court, and we will live with whatever decision they reach."

A strong-willed lawyer with a libertarian streak, Jackson started Kendall-Jackson 22 years ago, building an empire out of sweet Chardonnay. Although Forbes estimated the company's sales at $450 million in 2003, Jackson empathizes with smaller winemakers, associates said.

Also, Jackson had already fought and beaten a powerful Midwest wholesaler, Judge & Dolph, in an unrelated federal case. Judge & Dolph is controlled by William W. Wirtz, who also owns the Chicago Blackhawks hockey team and Chicago's United Center.

Jackson "does what's good for the company, and direct shipping is good for the company. He's not afraid of anybody," coalition president Foster said.


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