Wine Institute and Member Wineries File Suit to Stop Illinois False Claims Act Lawsuits

SAN FRANCISCO — Wine Institute, and three of our member wineries (Chimney Rock Winery, the Miner Family Winery, and Staglin Family Vineyard), have filed suit in Illinois to fight the spate of “Illinois False Claims Act” (IFCA) lawsuits that have been filed against wineries selling directly to consumers in that state. Brought by a private practice attorney, Stephen B. Diamond, the lawsuits have claimed that the wineries should have charged tax on the shipping fees for his online purchases delivered into Illinois. The defendants in the lawsuit are the Illinois Department of Revenue and the Illinois Attorney General.

Wine Institute, on behalf of its members, explored administrative and legislative options for solutions to stop the actions against wineries. When these solutions were not forthcoming, we retained the services of ReedSmith, LLC in Chicago to represent us in the current litigation. Wine Institute appreciates the participation of the plaintiff wineries, as well as support from the Napa Valley Vintners which has provided assistance with expenses incurred in the litigation. While our litigation will not immediately provide a remedy for those wineries already in litigation, our goal in bringing this action is to put a stop to IFCA lawsuits against wineries in the future and to clarify the confusion surrounding when/if a winery should be collecting taxes on shipping fees. Please click here for further details about the case, what impact it is likely to have on wineries already in litigation and what wineries should do if they receive a summons in the future.