Maryland’s Beer Delivery Case Shows Why “Employee Delivery” May Not Save Discriminatory Alcohol Shipping Laws
States defending local alcohol privileges often try to draft around the dormant Commerce Clause with a delivery distinction. They do not always write that only in-state breweries, wineries, or distilleries may ship. Instead, they create a delivery, shipping, self-distribution, or direct-sale privilege and then say the privilege may be exercised only through the permit holder’s own employees.
That sounds neutral. It usually isn’t.
A local brewery can send an employee across town. A local winery can deliver from the tasting room. A local distillery can put someone in a branded van. But a brewery in Washington, Oregon, Colorado, California, or even a more distant part of Pennsylvania cannot realistically build an employee-delivery operation for low-volume consumer deliveries in Maryland. The law does not need to say “out-of-state producers lose” if it forces out-of-state producers to use a delivery method they cannot practically or economically use.
That is why Furlong v. Brown, now on appeal in the Fourth Circuit, deserves attention from breweries, wineries, distilleries, distributors, and alcohol regulatory lawyers. The case is not just about Maryland beer delivery. It is about whether states can evade Granholm v. Heald by creating local delivery privileges and then hiding discrimination in the delivery method.
The District of Maryland’s answer was no.
The appeal is pending in the Fourth Circuit as Douglas Furlong v. Anthony Brown, No. 26-1353. The district court case challenged Maryland’s Direct Delivery Law, which allowed only in-state beer manufacturers to obtain direct beer delivery permits and required delivery by the permit holder’s own employees rather than common carriers. In the court’s August 2025 summary judgment opinion, Judge Richard Bennett summarized the problem directly: Maryland “allows only in-state breweries to directly deliver beer to Maryland residents” and requires those breweries to make delivery “by their own employees, rather than by common carrier.”
That structure produced two related Commerce Clause problems. The first was obvious: Maryland tied permit eligibility to Maryland manufacturer and wholesaler licensing requirements, which in turn included residency requirements. The second was more important for other states: Maryland’s employee-delivery rule appeared facially neutral, but it made the direct-delivery privilege realistically usable by local breweries and practically unavailable to most out-of-state breweries.
After trial, the court held that the employee-delivery requirement “makes direct sales impractical from an economic standpoint” and “effectively precludes many out-of-state manufacturers from directly delivering their beer.” That is the language other states should study closely.
The court did not stop at the statutory label. It looked at how the law worked. Maryland capped direct delivery at 12 cases per consumer per year. A Washington brewery like Varietal could not justify maintaining employees or a delivery operation in Maryland for that small market. A Pennsylvania brewery near Maryland might manage it. A Maryland brewery could do it easily. The burden, therefore, did not fall evenly. It favored local and nearby producers while excluding more distant out-of-state breweries.
The court framed the inquiry in language that should matter in future manufacturer-parity cases: “The fulcrum of this inquiry [is] whether the [challenged regime] erects a special barrier to market entry by non-domestic entities.” Maryland’s employee-delivery rule did exactly that. The court found that the requirement “likely narrows the market by excluding most out-of-state breweries to the broad benefit of in-state manufacturers who can likely engage in direct delivery via their own employees.”
That is the key lesson from Furlong. A state cannot necessarily save a local-only delivery privilege by calling it an employee-delivery rule.
Maryland raised the usual defenses. The court did not reject the legitimacy of alcohol regulation, tax collection, product safety, underage access, or the three-tier system. It rejected Maryland’s failure to prove why discrimination was necessary.
The three-tier defense failed because Maryland had already created the exception. Maryland argued that its direct beer delivery law belonged to its alcohol regulatory system and deserved protection under the Twenty-First Amendment. The court did not attack the three-tier system. It attacked Maryland’s use of the three-tier system as a shield for a local carveout. Once Maryland allowed eligible beer manufacturers to bypass ordinary distribution and sell directly to consumers, the question was no longer whether Maryland could maintain three tiers. The question was whether Maryland could reserve an exception to the tiers for local producers.
The court’s answer was no. The direct delivery permit “does not implicate the wholesaler tier and, even if it did, Maryland has already authorized out-of-state producers to bypass that tier.” That sentence matters for distributors as much as for producers. Furlong does not attack the wholesaler tier as such. It attacks selective exceptions to the tier. A state can preserve three-tier distribution. But if it punches a hole in the tier for local suppliers, it should not be able to invoke the tier as the reason out-of-state suppliers must stay out.
The tax-collection defense failed for similar reasons. Maryland argued that out-of-state beer delivery would make tax collection more difficult. The court treated tax collection as a legitimate interest, but not as a free pass. Maryland already allowed in-state and out-of-state wineries to ship directly to Maryland consumers under a permit, bond, and reporting system. Maryland’s own witness admitted the State “could apply to out-of-state beer producers the bond payment system presently used to track out-of-state wineries’ tax payments.” Administrative inconvenience did not justify discrimination. The court found Maryland “could apply reasonable, nondiscriminatory alternatives” to out-of-state beer manufacturers.
The product-safety defense also failed for lack of proof. Maryland argued that it could inspect in-state breweries but not out-of-state breweries, and that out-of-state direct delivery might increase the risk of unsafe beer reaching consumers. The court found “no concrete evidence” that direct delivery by out-of-state manufacturers increased the risk of unsafe beer. It also found that the State offered “mere speculation” and “unsupported assertions,” which were “insufficient to justify a discriminatory alcohol regulation.”
The underage-access argument mattered most to the employee-delivery issue. Maryland argued that delivery by local employees better protected minors than delivery by common carriers. The State claimed employees were more accountable, more connected to the community, and more likely to follow alcohol-awareness training. The court found the proof too thin. Maryland’s expert conceded “there is little research as to the effects of common carrier delivery,” and the court found “no evidence other than speculation” that local employees’ community connection made them less likely than common carriers to deliver alcohol to minors.
That analysis should matter beyond Maryland. Maryland already allowed wine delivery by common carrier through a permitting system. Maryland had also allowed beer delivery by common carrier between 2021 and 2024, and the court found only one instance during that period in which a common carrier delivered beer without proper age verification. If a state can regulate common-carrier delivery with permits, reporting, labels, age verification, training, bonds, and penalties in one category, it needs evidence—not slogans—to justify banning common carriers in another.
Maryland’s increased-consumption argument also failed. The State argued that letting out-of-state breweries deliver beer would increase supply, reduce prices, and increase consumption. The court found that too speculative. The direct-delivery market was small; only a handful of Maryland breweries had used the permit; and the State offered no Maryland-specific modeling showing that out-of-state participation would materially increase beer consumption. The court found “no concrete evidence” that beer consumption would increase and rejected “mere speculation” that consumption would rise simply because out-of-state breweries could access the same channel.
In other words, Furlong gives states a list of arguments that need more than repetition. Do not simply say “three-tier.” If the challenged law creates an exception to three-tier, explain why the discriminatory limit is essential. Do not simply say “tax collection.” Explain why permits, bonds, reports, audits, federal licensing, penalties, and enforcement cannot work. Do not simply say “minors.” Show why the challenged discrimination actually reduces underage access and why nondiscriminatory carrier safeguards will not. Do not simply say “common carriers are different.” If the state already allows common carriers for wine, beer, spirits, or another alcohol category, explain why the same tools cannot work elsewhere. And do not assume employee delivery solves the Commerce Clause problem. In many cases, employee delivery may be the problem.
That point is not limited to Maryland. Other states use similar delivery-method language, though the constitutional risk varies with context.
Those statutes do not all present the same constitutional problem. A retail cocktails-to-go rule for local restaurants is not the same as a manufacturer direct-delivery privilege reserved for local breweries. A self-distribution rule with a genuinely workable outstate license may be easier to defend than one that gives out-of-state manufacturers a right they cannot practically use. But Furlong teaches that courts should look past labels. The question is practical market access.
If a delivery law lets local manufacturers use a privilege while making the same privilege economically or logistically unrealistic for out-of-state manufacturers, the state should expect the question Maryland could not answer: why is that discrimination necessary?
The remedy in Furlong reinforces that point. Maryland did better on remedy than liability. After judgment, the State argued that the original injunction swept too broadly because it barred enforcement of more than the residency and employee-delivery restrictions the court found unconstitutional. The court agreed and narrowed the judgment. But that did not undo the plaintiffs’ win. It made the remedy more precise.
In its February 2026 amended order, the court explained that the unconstitutional discrimination could be remedied by “(1) extending direct delivery permits to out-of-state producers, and (2) extending delivery methods to include common carriers.” The court also quoted the Supreme Court’s rule that federal-court decrees “must directly address and relate to the constitutional violation itself.”
That remedy matters. Courts do not need to dismantle alcohol regulation to fix discrimination. They can level up the privilege by extending it to out-of-state producers. Or the state can level down by removing the privilege. What the state cannot do is keep the privilege for local producers only.
Furlong should also be read alongside Buckel Family Wine v. Mosiman, the Iowa winery self-distribution case we previously analyzed on Libation Law Blog. In Buckel, the Southern District of Iowa held that Iowa could not let in-state wineries sell directly to Iowa retailers while denying out-of-state wineries the same right. That case was not about consumer wine shipping. It was about direct-to-retail sales and self-distribution—another manufacturer-level exception to the three-tier system.
Together, Furlong and Buckel show why manufacturer-parity cases may be stronger than some retailer-shipping cases. The manufacturer cases sit closer to Granholm. In each, the state created a producer-level privilege for local manufacturers and denied equal practical access to out-of-state manufacturers.
For breweries, Furlong matters because many states continue to experiment with direct beer delivery, taproom delivery, club shipments, self-distribution, festival delivery, online ordering, and delivery to retailers. If those rights are available only to local breweries, or only to breweries that can use local employees or local vehicles, the constitutional issue should draw attention.
For wineries and distilleries, the same issue can arise whenever a state creates manufacturer privileges by product category or license type and then ties access to in-state residency, in-state premises, in-state employees, licensee-owned vehicles, or in-state licensing that out-of-state producers cannot obtain or cannot practically use.
For distributors, Furlong does not attack the three-tier system itself. It attacks selective exceptions to the three-tier system. A state can preserve the wholesaler tier. But if it abandons that tier for local producers through self-distribution, direct delivery, or direct-to-retail privileges, it should not be able to invoke the tier as a constitutional defense against out-of-state producers seeking equal practical access.That is why the Fourth Circuit appeal matters. The next frontier in alcohol Commerce Clause litigation may not be retailer shipping. It may be manufacturer parity. And Furlong gives courts, regulators, and industry participants a clear warning: a state cannot create a local delivery privilege and then hide discrimination in the delivery method.
