Interstate Mail Order Shipments and State Law Restrictions on Goods Sold

[az287]

My question involves business law in the state of: CA / NV

California has a law going into effect on July 1, 2012 which "prohibit a product from being sold in the state if it is the result of force feeding a bird for the purpose of enlarging the bird’s liver beyond normal size." This law in effect outlaws the production and sale of Foie Gras in the State of California.

http://leginfo.legislature.ca.gov/fa...00320040SB1520


My question is: I plan to open an internet store in the state of Nevada with headquarters, inventory and all other business activities strictly inside the state of NV. Would the act of shipping Foie Gras across the border to CA constitute a 'sale' in CA and therefore violate the statue as written or does the 'sale' take place in NV. The language of the statue prohibits the "product from being sold", is the location of delivery relevant to the 'sale'?

I understand the rules regarding sales tax and for that purpose realize that the sale is in NV and free of CA tax, I am strictly interested in the ability/likelihood for the State of California to take action against my company under the new law.

Thank you in advance,

[Conrad Hunter]

Unless someone has a concrete answer, my answer is that CA can't regulate sales in interstate commerce.

Look at some of the case law/decisions involving sales of wine in interstate commerce.

Your contacts with CA would be minimal and would not be enough for CA to have any long arm jurisdiction. First of all, how would they know there was force feeding? Sounds like you would have to be forcefeeding in CA for there to be an offense. Or, does the law outlaw goose liver, force feeding or not? That would be overbroad though how does anyone tell the difference. I would suggest this law will undergo a Constitutional challenge sometime soon and will go under.

Is it possible to test the product in its packaged state to know that the goose was force fed? I have never heard of such a thing. If such a chemical or genetic test was possible, what agency in CA has that kind of money to waste especially when they have no jurisdiction?

I would assume you will not direct advertising specifically to CA (that might create long arm jurisdiction). Thus, any sales to CA would be incidental. Unless you drive in a semi-trailer with the product advertised on the side I don't see how it could even come to anyone's attention that would care. Of course, some animal rights nuts could order it, make a stink, but again, no jurisdiction unless you specifically direct your activities at CA.




As bankrupt as CA is, I would think they have more important things to spend money on.

Also, many legislatures, state and federal, pass laws that are also mandates which cost money to enforce, but they provide no money for enforcement, so only the really unlucky ever get affected. The legislature will pass a law that the counties are expected to enforce, but provide the county no money or revenue to do so. One big reason there are so many unenforced laws on the books.

[az287]

Look at some of the case law/decisions involving sales of wine in interstate commerce.

Great point. Does anyone know of any precedents?

[Dogmatique]

Is it possible to test the product in its packaged state to know that the goose was force fed? I have never heard of such a thing. If such a chemical or genetic test was possible, what agency in CA has that kind of money to waste especially when they have no jurisdiction?

Conrad, you DO what what foie gras is, right?

[Mr. Knowitall]

The principal test for whether or not a state law prohibiting the sale of certain goods impinges upon interstate commerce is whether it treats in-state sales and products differently from out-of-state sales and products. If California bans the sale of foie gras by out-of-state mail order companies while permitting it to be sold by businesses within the state, the law has obvious problems. If the prohibition is applied equally to all businesses, in-state and out, it's much more likely to stand.

Foie gras bans and ordinances have been around for a number of years and, despite the argument that they're unconstitutional, I'm not aware of any actual litigation of the issue. Some restauranteurs are talking about challenging the California ban. In the interim, the question of whether to ship into California in defiance of their ban or whether to decline sales into California until the legal issues are resolves is one to be made in consultation with your lawyer, based upon your full business plan. One thing I would want to know, up front, is whether you truly intend to be a national business with incidental sales to California, or if your goal is to serve markets that operate under bans with other sales being incidental.