Hobby distillers fight for the right to make moonshine

(CN) — For over 150 years, federal law has prohibited would-be moonshiners from distilling liquor at home. That may be coming to an end, however, as last year, a federal judge in Texas found the law unconstitutional.

Attorney Andrew Grossman urged a Fifth Circuit panel Monday to uphold the lower court ruling, arguing the law exceeds federal taxing power. He represents the Hobby Distillers Association and several of its members, who are challenging the law.

Though the law was intended to prevent liquor tax evasion, Grossman argued the real reason it was passed was a compromise with the temperance movement to secure support for lowering the liquor tax.

“This was a political horse trade that bought them off,” Grossman said. “It had nothing to do with the collection of the tax.”

Justice Department attorney Caroline Tan argued the law is valid under the federal government’s taxing power, as it’s rationally related to tax collection. She said the plaintiffs are overstating the law’s scope, noting it doesn’t ban all home distilling, only in a “dwelling house” or attached structures. The law would not prohibit the sole individual plaintiff that the trial court deemed to have standing, she added, since he already has a permit to make fuel alcohol in a shed 261 feet away.

Visiting U.S. District Judge Fernando Rodriguez Jr. questioned whether that distinction undermines the law’s stated purpose.

“My understanding is the government supports the statute by contending that it’s difficult to monitor and, as a result, to calculate and collect the taxes imposed on distilled spirits produced inside a dwelling house, but you’re saying that as long as they do it 200 feet away in an enclosed shed, that the government can readily determine what’s produced there,” Rodriguez, a Donald Trump appointee, said. “I’m not sure what the difference is between the government’s ability to look into a house as opposed to a shed that’s 200 feet away from the house.”

Tan responded that all that matters is whether the law is reasonably related to preventing tax evasion.

“The question is not whether Congress drew, in some senses, a perfect line, but whether the line that Congress did draw here is reasonable,” Tan said.

U.S. Circuit Judges Edith Jones, a Ronald Reagan appointee, and James Graves, a Barack Obama appointee, joined Rodriguez on the panel.