Excise tax on distilled spirits; The home distilling ban (26 USC §§ 5178(a)(1)(B) & 5601(a)(6)); Whether Congress had the authority to enact the ban as a means of collecting the federal excise tax on distilled spirits; The Taxing Clause (US Const art I, § 8, cl 1); The Necessary & Proper Clause (US Const. art I, § 8, cl 18); McCulloch v Maryland; Standing; Bond v United States

The court held that while plaintiff-Ream had standing to challenge Congress’s power to enact the home-distilling ban his challenge failed because “the ban is a necessary and proper means of collecting the federal excise tax on distilled spirits.” The home-distilling ban was enacted in 1868 as part of Congress’s efforts to collect federal excise taxes on distilled spirits. It prohibits the production of distilled spirits in homes, sheds, any vessel or boat, and other unsanctioned locations. Violators are subject to a felony conviction and a substantial fine. Ream wished to distill whiskey at home and brought this action claiming that Congress lacked the power to enact a law prohibiting the possession of a still in a “dwelling house.” The district court granted defendants’ motion to dismiss based on lack of standing where Ream had yet to purchase a still or been threatened with prosecution under the challenged law. The court disagreed on the standing issue, holding that Ream faced a “credible threat of prosecution” if he were to distill whiskey in his home. And his “constitutional interest and its relation to his conduct are identical to the ones that” the Supreme Court held gave the plaintiff in Bond standing to assert her claim. Turning to the merits, the court held that while the ban could not be supported under the Taxing Clause, it was supported under the Necessary and Proper Clause. It reviewed the history underlying the ban and the facts surrounding it, and concluded that the ban “addressed an actual problem that had confounded the federal government from its earliest days[,]” and that it was “lawful when enacted, and remains so today.” The court reversed the district court’s order dismissing Ream’s claims for lack of jurisdiction and remanded with instructions to enter judgment in defendants’ favor.