Flying Goat Cellars co-owner Norm Yost
LOS ANGELES — A Central Coast winery is suing Santa Barbara County officials, alleging its constitutional rights are being stomped on by the transfer of a 1% fee on its sales to a private wine industry association.
Flying Goat Cellars, a family-owned winery in Lompoc, and its owners are the plaintiffs in the federal lawsuit, which was filed on May 21 in the Central District of California. Represented by the Goldwater Institute, the winery owners argue their First and Fifth Amendment rights were violated by a county requirement that Flying Goat pay a 1% assessment on its sales and become a member of the Santa Barbara County Vintners Association (SBCVA).
The winery views the SBCVA as engaging in “expressive, ideological and political” activities that Flying Goat disagrees with. The plaintiffs say the SBCVA’s activities to promote the counties’ wineries regionally and internationally are at odds with the winery’s focus on customers who visit the winery in person.
“Flying Goat’s success is built on building direct relationships with the customers who walk through our winery’s doors, not on international markets and the kinds of broad campaigns the vintners’ association favors,” Flying Goat co-owner Norm Yost said in a prepared statement. “Our vision for Flying Goat and the vintners association’s vision for the Santa Barbara wine industry are not the same.”
Among other things, the plaintiffs oppose the use of the mandated fees to fund overseas trips to South Korea and Japan in a bid to develop export markets for county wines – activities, they argue, that don't benefit Flying Goat’s business model.
The mandated 1% fee on county wineries’ sales was approved last year by the county Board of Supervisors after a vote of the county’s winery businesses.
“A general business improvement district can only be established on a vote of the businesses that will pay over 50% of the assessments proposed to be levied, where each winery’s vote is weighted by each winery’s proportional contribution to the total assessment,” the lawsuit states, adding that the weighted voting system means smaller wineries have little say in the matter.
In a statement provided to the Southern California Record by the CEO of the SBCVA, Alison Laslett, the association said it disagreed with the allegations in the lawsuit.
“Our focus remains on advancing the long-term success of Santa Barbara County's wine industry through collaborative marketing and regional promotion, industry advancement and government engagement,” the statement says. “Because this is an active legal matter, we will not comment further on the specifics of the litigation at this time.”
The SBCVA also noted that Santa Barbara County Wine Improvement District was established in accordance with California law and through a public process.
“Similar agriculture, wine and tourism assessment districts have been used statewide for decades to support regional marketing and economic development,” the statement says.
A senior staff attorney for the Goldwater Institute, Adam Shelton, said the U.S. Supreme Court has held that governments can’t force citizens to subsidize speech they don’t agree with.
“It has also recognized a fundamental right not to be compelled into private associations,” Shelton said. “Santa Barbara County’s mandate violates both principles.”
The lawsuit seeks to enjoin the defendants from enforcing the 1% fee and related agreements based on constitutional free-speech protections and the Fifth Amendment prohibition against the taking of private property for public use without just compensation.
The Goldwater Institute reported that Flying Goat’s complaint comes at a time when wineries’ production costs are increasing, more competitors are entering the wine market and consumer habits are shifting.
“Flying Goat Cellars says the county’s mandate could accelerate the squeeze on smaller, independent producers,” the institute reported.
