This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.
Facts
The Stroh Brewery Company challenged the constitutionality of New Mexico's 1979 "Discrimination in Selling Act," which required beer prices in New Mexico to match the lowest prices charged in other states. Stroh argued that the law violated the Commerce Clause of the U.S. Constitution. During the litigation, Stroh sold beer at prices not compliant with the law under a preliminary injunction bond, which stipulated liability if the law was ultimately upheld (paras 1-2, 9).
Procedural History
- District Court, January 7, 1980: Upheld the constitutionality of the 1979 law and granted summary judgment in favor of the Director of the New Mexico Department of Alcoholic Beverage Control (para 2).
- New Mexico Supreme Court, July 21, 1983: Affirmed the trial court's decision, relying on the U.S. Supreme Court's precedent in Joseph E. Seagram & Sons v. Hostetter (1966) (para 4).
- U.S. Supreme Court, 1984: Dismissed Stroh's appeal for lack of a substantial federal question (para 4).
- United States District Court, 1987: Invalidated the 1981 law, finding it unconstitutional under the Commerce Clause (para 6).
Parties' Submissions
- Appellant (Stroh Brewery Company): Argued that the 1979 law was invalidated by the U.S. Supreme Court's decision in Healy v. Beer Institute (1989), which declared price-affirmation statutes unconstitutional. Stroh contended that it had no liability under the bond because the law was "finally invalid" (paras 9-10).
- Appellee (Director of the New Mexico Department of Alcoholic Beverage Control): Asserted that the 1979 law remained valid under the "law of the case" doctrine, as it had been upheld in prior decisions. The Director also argued that Healy should not be applied retroactively (paras 9-11).
Legal Issues
- Was the 1979 "Discrimination in Selling Act" invalidated by the U.S. Supreme Court's decision in Healy v. Beer Institute?
- Should the "law of the case" doctrine apply to uphold the validity of the 1979 law despite subsequent federal rulings?
- Does Healy v. Beer Institute apply retroactively to absolve Stroh of liability under the bond?
Disposition
- The New Mexico Supreme Court affirmed the trial court's decision, holding Stroh liable under the bond (para 28).
Reasons
Majority Opinion (Per Sosa CJ, with Baca and Franchini JJ. concurring):
The Court held that the 1979 law was valid under the "law of the case" doctrine, as it had been upheld in prior decisions, including the Court's 1983 ruling. The Court reasoned that Healy v. Beer Institute did not apply retroactively because it established a new principle of law by overruling prior precedent (Seagram). Applying Healy retroactively would not serve the purposes of the Commerce Clause and could lead to inequitable results, such as undermining settlements reached with other brewers. The Court also found no manifest injustice in adhering to its prior rulings (paras 12-28).
Special Concurrence (Franchini J.):
Justice Franchini agreed with the majority's reasoning but emphasized that the U.S. Supreme Court's decision in James B. Beam Distilling Co. v. Georgia (1991) did not undermine the Court's reliance on the Chevron Oil framework to deny retroactive application of Healy. He distinguished the procedural posture of this case from Beam (paras 31-35).
Dissent (Montgomery J.):
Justice Montgomery dissented, arguing that the 1979 law was invalid under the U.S. Supreme Court's decision in Healy, which should be applied retroactively. He criticized the majority for misapplying the "law of the case" doctrine and violating the Supremacy Clause by upholding a law that was clearly unconstitutional. He also rejected the majority's reliance on Chevron Oil, asserting that no reliance interests justified denying retroactive application of Healy (paras 36-65).