Winebow, Inc. v. Capitol-Husting Co., Inc.

2018 WI 60

SUPREME COURT OF WISCONSIN
CASE NO.: 2017AP1595-CQ
COMPLETE TITLE: Winebow, Inc.,
Plaintiff-Appellee,
v.
Capitol-Husting Co., Inc. and L'Eft Bank Wine
Co. Limited,
Defendants-Appellants.

ON CERTIFIED QUESTION FROM THE UNITED STATES
COURT OF APPEALS FOR THE SEVENTH CIRCUIT

OPINION FILED: June 5, 2018
SUBMITTED ON BRIEFS:
ORAL ARGUMENT: February 19, 2018

SOURCE OF APPEAL:
COURT:
COUNTY:
JUDGE:

JUSTICES:
CONCURRED:
DISSENTED: BRADLEY, R. G., J. joined by ABRAHAMSON, J. and
KELLY, J. dissent (Opinion filed).
NOT PARTICIPATING:

ATTORNEYS:

For the defendants-appellants, there were briefs filed by
Thomas L. Shriner, Jr., Gregory N. Heinen, and Foley & Lardner
LLP, Milwaukee. There was an oral argument by Thomas L.
Shriner, Jr.

For the plaintiff-appellee, there was a brief filed by E.
King Poor (pro hac vice) and Quarles & Brady LLP, Chicago,
Illinois, with whom on the brief were Daniel M. Janssen, and
Quarles & Brady LLP, Milwaukee.
 2018 WI 60
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2017AP1595-CQ

STATE OF WISCONSIN : IN SUPREME COURT

Winebow, Inc.,

Plaintiff-Appellee, FILED
v.
JUN 5, 2018
Capitol-Husting Co., Inc. and L'Eft Bank Wine
Co. Limited, Sheila T. Reiff
Clerk of Supreme Court

Defendants-Appellants.

CERTIFICATION of question of law from the United States

Court of Appeals for the Seventh Circuit. Certified question

answered in the negative and cause remanded.

¶1 ANN WALSH BRADLEY, J. This case is before the court

on a certified question from the United States Court of Appeals

for the Seventh Circuit. Winebow, Inc. v. Capitol-Husting Co.,

Inc., 867 F.3d 862 (7th Cir. 2017); see Wis. Stat. § 821.01

(2015-16).1 It certified the following question: "Does the

definition of a dealership contained in Wis. Stat.

1
All subsequent references to the Wisconsin Statutes are to
the 2015-16 version unless otherwise indicated.
 No. 2017AP1595-CQ

§ 135.02(3)(b) include wine grantor-dealer relationships?"

Winebow, 867 F.3d at 871.

¶2 Our answer to this certified question will aid the

Seventh Circuit in determining whether Winebow, Inc.'s (Winebow)

attempt to end its business relationship with two wine

distributors is governed by the unilateral termination

limitations of the Wisconsin Fair Dealership Law (WFDL). See

Wis. Stat. § 135.03.

¶3 Winebow unilaterally terminated its relationship with

Capitol-Husting Co., Inc. and L'Eft Bank Wine Co. Limited (the

Distributors) after becoming dissatisfied. It argues that the

action was permissible because the parties' business

relationship is not an "intoxicating liquor" dealership entitled

to the protections of the WFDL. See §§ 135.02(3)(b), 135.066.

On the other hand, the Distributors contend that a wine grantor-

dealer relationship is a "dealership" entitled to such

protections and thus Winebow cannot unilaterally terminate its

relationship with the Distributors absent a showing of good
cause.

¶4 We conclude that a wine grantor-dealer relationship is

not included within the definition of a dealership in Wis. Stat.

§ 135.02(3)(b). Section 135.066(2) provides the operative

definition of "intoxicating liquor" for purposes of ch. 135, and

such definition explicitly excludes wine.

¶5 Accordingly, we answer the certified question in the

negative.

2
 No. 2017AP1595-CQ

I

¶6 Winebow is engaged in the business of importing and

distributing wine to downstream wholesalers. Since 2004,

Winebow has used Capitol-Husting as a distributor of its wines,

and in 2009 it commenced a similar relationship with L'Eft Bank.

¶7 After becoming dissatisfied with the Distributors,

Winebow abruptly terminated its relationship with them in

February of 2015. The parties did not have any express written

agreement that would prevent Winebow from unilaterally

terminating their relationships.

¶8 The Distributors responded to Winebow's termination by

letter, indicating their belief that they are entitled to the

protections of the WFDL. Such protections would prevent Winebow

from terminating their relationships absent "good cause." See

Wis. Stat. § 135.03.

¶9 Winebow countered by filing a declaratory judgment

action in the United States District Court for the Eastern

District of Wisconsin. Winebow, Inc. v. Capitol-Husting Co.,
Inc., No. 15-CV-225, slip op. at *1 (E.D. Wis. June 18, 2015).

It sought a declaration that it has no continuing obligations to

the Distributors. Id.

¶10 The District Court ruled in Winebow's favor. It

determined that "[w]ine is not intoxicating liquor in the

context of the WFDL, and thus the [Distributors'] business

relationship with Winebow is not subject to the unilateral

termination limitations of Chapter 135." Id. at *4.

3
 No. 2017AP1595-CQ

¶11 The Distributors appealed to the United States Court

of Appeals for the Seventh Circuit, contending that wine

dealerships are per se "intoxicating liquor" dealerships

entitled to the protections of the WFDL. Winebow, 867 F.3d at

867. The Seventh Circuit certified to this court the question

of whether the definition of "dealership" contained in Wis.

Stat. § 135.02(3)(b) includes wine grantor-dealer relationships.

Id. at 870-71.

II

¶12 Underlying this case are proposed statutory changes to

the WFDL and the governor's partial veto of some of these

changes. See 1999 Wis. Act 9, §§ 2166m, 2166s. We thus provide

brief background on the WFDL, the proposed changes to it, and

the partial veto.

¶13 The WFDL provides in part that a grantor of a

dealership may not terminate a dealership agreement without good

cause. Wis. Stat. § 135.03; see Ziegler Co., Inc. v. Rexnord,

Inc., 139 Wis. 2d 593, 594, 407 N.W.2d 873 (1987). Its
underlying purposes and policies include "[t]o promote the

compelling interest of the public in fair business relations

between dealers and grantors, and in the continuation of

dealerships on a fair basis." § 135.025(2)(a). Additionally,

it aims "[t]o protect dealers against unfair treatment by

grantors, who inherently have superior economic power and

superior bargaining power in the negotiation of dealerships[.]"

§ 135.025(2)(b).

4
 No. 2017AP1595-CQ

¶14 A grantor who violates the WFDL may be subject to an

action for "damages sustained by the dealer as a consequence of

the grantor's violation, together with the actual costs of the

action, including reasonable attorney fees." Wis. Stat.

§ 135.06. Further, a "dealer also may be granted injunctive

relief against unlawful termination, cancellation, nonrenewal or

substantial change of competitive circumstances." Id.

¶15 However, the WFDL does not apply to all business

relationships, but only to those defined as "dealerships." In

1999, the legislature sought to broaden the WFDL's reach to

ensure that "intoxicating liquor" dealers were protected. See

1999 Wis. Act 9, §§ 2166m, 2166s.

¶16 It did so by making two significant changes. First,

it amended the definition of a "dealership" to include

distributors of "intoxicating liquors." 1999 Wis. Act 9,

§ 2166m. The new definition, codified at Wis. Stat.

§ 135.02(3)(b), included within a "dealership":

A contract or agreement, either expressed or implied,
whether oral or written, between 2 or more persons by
which a wholesaler, as defined in s. 125.02(21), is
granted the right to sell or distribute intoxicating
liquor or use a trade name, trademark, service mark,
logotype, advertising or other commercial symbol
related to intoxicating liquor. This paragraph does
not apply to dealerships described in s. 135.066(5)(a)
and (b).
1999 Wis. Act 9, § 2166m.

¶17 This revised "dealership" definition explicitly

incorporated the definition of "intoxicating liquor" found in
Wis. Stat. ch. 125, which regulates alcohol beverages. Pursuant

5
 No. 2017AP1595-CQ

to Wis. Stat. § 125.02(8), "vinous liquors," or in other words

"wine," is expressly included under the umbrella of

"intoxicating liquor":

"Intoxicating liquor" means all ardent, spirituous,
distilled or vinous liquors, liquids or compounds,
whether medicated, proprietary, patented or not, and
by whatever name called, containing 0.5 percent or
more of alcohol by volume, which are beverages, but
does not include "fermented malt beverages."
§ 125.02(8).

¶18 Second, the legislature created Wis. Stat. § 135.066.

1999 Wis. Act 9, § 2166s. This new provision expressed the

legislature's desire for a competitive and stable wholesale

liquor market. See § 135.066(1). Like the legislature's

revised definition of "dealership," the newly enacted § 135.066

imported the definition of "intoxicating liquor" from

§ 125.02(8). § 135.066(2).

¶19 Both of these changes were included in the 1999 budget

bill. See 1999 Wis. Act 9. However, Governor Tommy Thompson

used his partial veto power to alter the revisions passed by the

legislature.2

2
The governor's partial veto power arises from Article V,
§ 10 of the Wisconsin Constitution, which sets forth,
"Appropriation bills may be approved in whole or in part by the
governor, and the part approved shall become law." Wis. Const.
art. V, § 10(1)(b). Pursuant to the partial veto power, the
governor may strike out language in an appropriation measure,
but may not add language. See State ex rel. Wisconsin Senate v.
Thompson, 144 Wis. 2d 429, 437, 424 N.W.2d 385 (1988); State ex
rel. Kleczka v. Conta, 82 Wis. 2d 679, 707-08, 264 N.W.2d 539
(1978).

(continued)
6
 No. 2017AP1595-CQ

¶20 Specifically, the governor struck language proposed by

the legislature from both Wis. Stat. §§ 135.02(3)(b) and

135.066. With respect to § 135.02(3)(b), he deleted the cross-

reference to the existing definition of "intoxicating liquor"

found in ch. 125.3

¶21 Edits to Wis. Stat. § 135.066 were much more

extensive. The governor eliminated large portions of

The partial veto power was originally a very broad power,
but has been subsequently limited. Originally, the governor
could "veto individual words, letters and digits, and also may
reduce appropriations by striking digits, as long as what
remains after veto is a complete, entire, and workable law."
Wisconsin Senate, 144 Wis. 2d at 437.

A 1990 amendment slightly limited the power, dictating that
"the governor may not create a new word by rejecting individual
letters in the words of the enrolled bill." Wis. Const. art. V,
§ 10(1)(c) (1990). This was the version in effect when Governor
Thompson exercised the veto at issue in this case. A subsequent
revision in 2008 brought Article V, § 10 to its present form,
further limiting the partial veto power by stating that "the
governor may not create a new word by rejecting individual
letters in the words of the enrolled bill, and may not create a
new sentence by combining parts of 2 or more sentences of the
enrolled bill." Wis. Const. art. V, § 10(1)(c).
3
The governor's veto with respect to Wis. Stat.
§ 135.02(3)(b) was as follows:

A contract or agreement, either expressed or implied,
whether oral or written, between 2 or more persons by
which a wholesaler, as defined in s. 125.02(21), is
granted the right to sell or distribute intoxicating
liquor, as defined in s. 125.02(8), or use a trade
name, trademark, service mark, logotype, advertising
or other commercial symbol related to intoxicating
liquor. This paragraph does not apply to dealerships
described in s. 135.066(5)(a) and (b).

7
 No. 2017AP1595-CQ

§ 135.066(2)-(4). What remained was the sole sentence,

"'Intoxicating liquor' has the same meaning given in s.

125.02(8) minus wine."4

4
Observe that the words "minus" in Wis. Stat.
§ 135.066(2)(a), formerly subsection (2)(b) in draft
legislation, and "wine" in former subsection (2)(d) are left
unscathed:

(2) DEFINITIONS. In this section:

(a) "Intoxicating liquor" has the same meaning
given in s. 125.02(8).

(b) "Net revenues" means the gross dollar amount
received from the sale of intoxicating liquor
minus adjustments for returns, discounts and
allowances.

(c) "Wholesaler" has the meaning given in s.
125.02(21).

(d) "Wine" has the meaning given in 125.02(22).

(3) LIABILITY OF TRANSFEREE OF INTOXICATING LIQUOR
GRANTOR.

(a) In this subsection:

1. "Goodwill" includes the use of a
trademark, trade name, logotype or other
commercial symbol, and the use of a
variation of a trademark, trade name,
logotype, advertisement or other commercial
symbol.

2. "Transferee" means a person who acquires
any asset or activity of a grantor's
intoxicating liquor business and who uses
the goodwill associated with the
intoxicating liquor of the grantor.

(b) A transferee shall be bound by each of the
grantor's dealerships with the grantor's
wholesalers and consequently shall be considered
(continued)
8
 No. 2017AP1595-CQ

¶22 Legislative findings enumerated in Wis. Stat.

§ 135.066(1) and a severability provision in sub. (6) escaped

the veto pen, but the governor struck several references to wine

in sub. (5), a nonapplicability provision.5 The legislature did

not override the governor's veto.

a grantor for the purposes of, and shall comply
with, the requirements of this chapter.

(4) CHANGE IN OWNERSHIP.

(a) In this subsection, "successor wholesaler"
means a wholesaler who succeeds to the
management, ownership or control of a wholesaler
or wholesaler's business or any part of a
wholesaler's business by any means including by
stock purchase, sale of assets or transfer or
assignment of a brand of intoxicating liquor that
is the subject of a dealership agreement.

(b) A change in the management, ownership or
control of a wholesaler, a wholesaler's business
or any part of a wholesaler's business is not
good cause for a grantor to terminate, cancel,
fail to renew or substantially change the
competitive circumstances of its dealership with
a successor wholesaler if the successor
wholesaler meets the grantor's reasonable and
material qualifications for wholesaler applicants
in effect at the time of the change. If the
successor wholesaler meets the grantor's
reasonable and material qualifications for
wholesaler applicants in effect at the time of
the change, the successor wholesaler shall
succeed to the dealership rights of the
predecessor wholesaler and the grantor shall
continue to be bound by the dealership.
5
In this section, the partial veto was as follows:

(5) NONAPPLICABILITY. This section does not apply to
any of the following dealerships:
(continued)
9
 No. 2017AP1595-CQ

III

¶23 This case requires us to interpret Wis. Stat.

§§ 135.02 and 135.066. Statutory interpretation presents a

question of law we review independently. Roberts v. T.H.E. Ins.

Co., 2016 WI 20, ¶19, 367 Wis. 2d 386, 879 N.W.2d 492. We are

not bound by the federal district court's interpretation, but it

may aid in our analysis. Baldewein Co. v. Tri-Clover, Inc.,

2000 WI 20, ¶10, 233 Wis. 2d 57, 606 N.W.2d 145 (citing Daanen &

Janssen, Inc. v. Cedarapids, Inc., 216 Wis. 2d 395, 400, 573

N.W.2d 842 (1998)).

IV

¶24 With the preceding context and standard of review in

hand, we examine next the specific question certified by the

Seventh Circuit: whether the definition of a dealership

(a) Dealerships in which a grantor, including any
affiliate, division or subsidiary of the grantor,
has never produced more than 200,000 gallons of
intoxicating liquor in any year.

(b) Dealerships in which the dealer's net
revenues from the sale of all of the grantor's
brands of intoxicating liquor, except wine,
constitute less than 5% of the dealer's total net
revenues from the sale of intoxicating liquor,
except wine, during the dealer's most recent
fiscal year preceding a grantor's cancellation or
alteration of a dealership and the dealer's net
revenues from the sale of all of the grantor's
brands of wine constitute less than 5% of the
dealer's total net revenues from the sale of wine
during the dealer's most recent fiscal year
preceding a grantor's cancellation or alteration
of a dealership.

10
 No. 2017AP1595-CQ

contained in Wis. Stat. § 135.02(3)(b) includes wine grantor-

dealer relationships.

¶25 Winebow asserts that the "minus wine" definition of

"intoxicating liquor" in Wis. Stat. § 135.066 applies to the

entirety of ch. 135, and that consequently we should answer the

certified question in the negative. Conversely, the

Distributors contend that the definition of "dealership" in

§ 135.02(3)(b) incorporates the definition of "intoxicating

liquor" from ch. 125, a definition that expressly includes wine.

¶26 Statutory interpretation begins with the language of

the statute. State ex rel. Kalal v. Circuit Court for Dane

Cty., 2004 WI 58, ¶45, 271 Wis. 2d 633, 681 N.W.2d 110. If the

meaning of the statute is plain, we need not further the

inquiry. Id.

¶27 Wisconsin Stat. § 135.066(2) defines "intoxicating

liquor" as having "the meaning given in s. 125.02(8) minus

wine." Winebow suggests that the language of the statute

plainly and unambiguously excludes wine from the definition of
"intoxicating liquor" for chapter 135.

¶28 We agree with Winebow. Its interpretation of Wis.

Stat. § 135.066(2) is supported by several considerations.

First, contrary to the Distributors' argument, the fact that the

definition is not located in the "definitions" section of the

statute is not dispositive. Neither the Distributors nor the

dissent cite any case law that exclusively tethers definitions

to a correspondingly labeled section of the statutes.

11
 No. 2017AP1595-CQ

¶29 Wisconsin Stat. § 135.066(2) provides the sole

definition of "intoxicating liquor" in ch. 135, and it excludes

wine. The term "intoxicating liquor" is used eleven times in

chapter 135, but defined only once. We aim for uniformity of

definitions within a statutory chapter, not diversity of

definitions. See Bank Mut. v. S.J. Boyer Const., Inc., 2010 WI

74, ¶31, 326 Wis. 2d 521, 785 N.W.2d 462. "When the same term

is used throughout a chapter of the statutes, it is a reasonable

deduction that the legislature intended that the term possess an

identical meaning each time it appears." Id. For one

definition of "intoxicating liquor" to control § 135.066 and

another to control the rest of the chapter would run afoul of

this maxim.

¶30 Rather, "[s]ections of statutes relating to the same

subject matter must be construed in pari materia."6 State v.

Clausen, 105 Wis. 2d 231, 244, 313 N.W.2d 819 (1982). Applying

this canon on interpretation here, we arrive at the conclusion

that the single "intoxicating liquor" definition supplied in ch.
135 should apply to the entirety of the chapter.

¶31 Further, the Wis. Stat. § 135.066(2) "minus wine"

definition would serve no purpose if limited in its application

6
"In pari materia" refers to statutes and regulations
relating to the same subject matter or having a common purpose.
In re Jeremiah C., 2003 WI App 40, ¶17, 260 Wis. 2d 359, 659
N.W.2d 193. The statutory construction doctrine of in pari
materia requires a court to read, apply, and construe statutes
relating to the same subject matter together. Id.

12
 No. 2017AP1595-CQ

to § 135.066 but not the remainder of ch. 135. Outside of the

"minus wine" definition, § 135.066 contains legislative

findings, a nonapplicability provision, and a severability

provision. The "minus wine" language does not affect any of

these remaining provisions.7 Limiting the application of the

"minus wine" definition to § 135.066 would render the language a

nullity.8

¶32 Additionally, treatises on both the WFDL and alcohol

regulation uniformly support our application of the "minus wine"

definition provided by Wis. Stat. § 135.066(2). As one treatise

on the WFDL advises, "intoxicating liquor refers to spirits, not

wine or beer." Michael A. Bowen et al., The Wisconsin Fair

7
The dissent asserts that "[t]he definition of intoxicating
liquor in § 135.066 retains a function even if limited to its
specific section of ch. 135." Dissent, ¶50. According to the
dissent, "[i]t applies to the legislative findings of sub. (1),
the non-applicability provisions of sub. (5), and the
severability part of sub. (6). Id. But if the "minus wine"
definition applies within § 135.066 only, what is its actual
effect? The legislative findings are mere background and define
no substantive rights. Further, as the Seventh Circuit
correctly recognized in its certification, none of the other
provisions of § 135.066 is affected by the "minus wine" language
of sub. (2). See Winebow, Inc. v. Capitol-Husting Co., Inc.,
867 F.3d 862, 868 (7th Cir. 2017). The dissent's interpretation
thus renders the "minus wine" language superfluous.
8
Stated differently, to read the statute to include wine
would render "minus wine" mere surplusage, a result that must be
avoided. See Milwaukee Cty. v. Dep't of Indus., Labor and Human
Relations Comm'n, 80 Wis. 2d 445, 452-53, 259 N.W.2d 118 (1977)
(quoting Cook v. Indus. Comm'n, 31 Wis. 2d 232, 239-40, 142
N.W.2d 827 (1966) ("[S]tatutes should be so construed that no
word or clause shall be rendered surplusage.")).

13
 No. 2017AP1595-CQ

Dealership Law § 4.34A at 61 (4th ed. 2012); see also id.

(explaining that "the governor's partial vetoes of the 1999

amendment make it clear that he intended (3)(b) to be

inapplicable to wine wholesalers.").9

¶33 Similarly, a treatise on Wisconsin alcohol beverages

regulation opines that "the applicable definition of

intoxicating liquor in Wis. Stat. ch. 135 excludes wine, such

that [ch. 135's] special WFDL provisions apply only to

distilled-spirits distribution agreements." Aaron R. Gary,

Alcohol Beverages Regulation in Wisconsin § 4.66 (2nd ed. 2016).

¶34 In the over eighteen years since the enactment of the

"minus wine" provision, the legislature certainly could have

acted to amend the law if it thought the commentators'

understanding was incorrect. However, it did not override the

governor's veto in 1999, and it has remained silent in the

intervening years.

¶35 As the Seventh Circuit aptly observed in its

certification, there is "no express statutory language"
supporting the Distributors' position. See Winebow, 867 F.3d at

9
In his veto message, Governor Thompson was explicit
regarding the reasons for his partial veto: "I am partially
vetoing these provisions so that wine will be excluded from
treatment under these changes to the Wisconsin Fair Dealership
Law because I object to wine being treated the same as
intoxicating liquor." Governor's Veto Message, Act 9, at § F.4
(Oct. 27, 1999); see State ex rel. Kalal v. Circuit Court for
Dane Cty., 2004 WI 58, ¶51, 271 Wis. 2d 633, 681 N.W.2d 110
("legislative history is sometimes consulted to confirm or
verify a plain-meaning interpretation").

14
 No. 2017AP1595-CQ

869. Cross references to their preferred definition were

removed from Wis. Stat. § 135.066 by Governor Thompson's partial

veto. Following that veto, what remains is unambiguous in its

effect to exclude wine from the definition of "intoxicating

liquor."

¶36 Instead of giving effect to ch. 135's single

definition of "intoxicating liquor," the Distributors would have

the court follow a path through ch. 125 to arrive at their

preferred definition. The Distributors' circuitous route begins

at Wis. Stat. § 135.02(3)(b), which references the definition of

"wholesaler" from § 125.02(21). Pursuant to § 125.02(21),

"'[w]holesaler' means a person, other than a brewer, brewpub,

manufacturer, or rectifier, who sells alcohol beverages to a

licensed retailer or to another person who holds a permit to

sell alcohol beverages at wholesale." We are then directed to

§ 125.02(1), which defines "alcohol beverages" as "fermented

malt beverages and intoxicating liquor." Finally, moving to

§ 125.02(8), we arrive at the definition of "intoxicating
liquor" as including "vinous liquors," more commonly known as

wine.

¶37 Our interpretation gives effect to the sole definition

of "intoxicating liquor" located in ch. 135, one which is

located in a statutory section beneath the heading,

"Intoxicating liquor dealerships." If the court here were to

decide that it is acceptable to effectuate a definition from ch.

125 that is not referenced within ch. 135, there would be no
clear stopping point to such a practice.
15
 No. 2017AP1595-CQ

¶38 In sum, we conclude that a wine grantor-dealer

relationship is not included within the definition of a

dealership in Wis. Stat. § 135.02(3)(b). Wisconsin Stat.

§ 135.066(2) provides the operative definition of "intoxicating

liquor" for purposes of Wis. Stat. ch. 135, and such definition

explicitly excludes wine.

¶39 Accordingly, we answer the certified question in the

negative and remand the cause to the United States Court of

Appeals for the Seventh Circuit.

By the Court.—Certified question answered in the negative

and cause remanded to the United States Court of Appeals for the

Seventh Circuit.

16
 No. 2017AP1595-CQ.rgb

¶40 REBECCA GRASSL BRADLEY, J. (dissenting). The

legislature unquestionably intended to include wine distributors

as dealers under Wis. Stat. ch. 135 and then-Governor Tommy

Thompson1 obviously intended to exclude them. But legislative

intent behind enactment of a law——or executive intent motivating

the exercise of a veto——cannot govern statutory interpretation.

Rather, our analysis must focus on the statutory language itself

and "[i]f the meaning of the statute is plain, we ordinarily

stop the inquiry." State ex rel. Kalal v. Circuit Court for

Dane Cty., 2004 WI 58, ¶45, 271 Wis. 2d 633, 681 N.W.2d 110. A

plain meaning interpretation of ch. 135, giving effect to every

word, requires answering the certified question from the Seventh

Circuit Court of Appeals in the affirmative: The definition of

a "[d]ealership" contained in Wis. Stat. § 135.02(3)(b) includes

wine grantor-dealer relationships. The isolated definition in

Wis. Stat. § 135.066(2)(a), on which the majority relies to

reach the opposite conclusion, applies only in § 135.066.

Because the majority's interpretation is wrong, I respectfully
dissent.

I

¶41 Wisconsin Stat. ch. 135, also known as the Wisconsin

Fair Dealership Law, governs grantor-dealer relationships and

"shall be liberally construed and applied to promote" the

purposes set forth in Wis. Stat. § 135.025(2), which include,

for example, (1) fairness in business relationships between

1
Then-Governor Tommy Thompson will subsequently be referred
to as "Governor."

1
 No. 2017AP1595-CQ.rgb

dealers and grantors and in their continuation; (2) protection

of dealers from grantors who "have superior economic power and

superior bargaining power"; and (3) statutory rights and

remedies for dealers.2

¶42 The question before the court is whether the two wine

distributors in this case are "[d]ealers" protected by ch. 135.

The wine distributors claim dealership status, while Winebow

insists ch. 135 does not apply to wine distributors at all. A

textual interpretation of ch. 135 provides a clear answer: the

wine distributors are "[d]ealers."

¶43 The analysis necessarily starts in Wis. Stat.

§ 135.02, which supplies the definitions to be used throughout

2
Wisconsin Stat. ch. 135 comprises eleven subsections.
Wisconsin Stat. § 135.01 gives the title of chapter 135.
Section 135.02 furnishes the definitions that apply throughout
the entirety of ch. 135. Section 135.025 details the purposes
of the chapter, requires liberal application to meet those
purposes, and prohibits parties from contracting away ch. 135's
protections. Section 135.03 explains that dealerships may not
be altered or terminated without a showing of good cause.
Section 135.04 imposes rules and notice deadlines for
termination or changes in a dealership. Section 135.045 governs
the repurchase of inventory upon termination of a dealership by
the grantor. Section 135.05 discusses the applicability of
arbitration agreements in ch. 135. Section 135.06 affords
dealers the right to recover attorney fees and obtain injunctive
relief in actions against grantors for violating ch. 135.
Section 135.065 deems any violation of the chapter by a grantor
an irreparable injury for purposes of seeking a temporary
injunction. Section 135.066 contains legislative findings
specific to intoxicating liquor dealers, defines "[i]ntoxicating
liquor," renders this section inapplicable to two types of
dealerships, and makes the provisions in this section severable.
Section 135.07 declares ch. 135 inapplicable to motor vehicle
dealers, insurance businesses, and door-to-door sales of goods
or services.

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ch. 135. Section 135.02 defines both "Dealer" and "Dealership."

Section 135.02 provides, as material:

In this chapter:

(2) "Dealer" means a person who is a grantee of a
dealership situated in this state.

(3) "Dealership" means any of the following:

. . . .

(b) A contract or agreement, either expressed or
implied, whether oral or written, between 2 or more
persons by which a wholesaler, as defined in s.
125.02(21), is granted the right to sell or distribute
intoxicating liquor or use a trade name, trademark,
service mark, logotype, advertising or other
commercial symbol related to intoxicating liquor.
This paragraph does not apply to dealerships described
in s. 135.066(5)(a) and (b).
(Emphasis added.) To determine whether a "[d]ealership" exists

between Winebow and the two wine distributors, we need to know

whether the wine distributors are "wholesaler[s]."

¶44 The language of Wis. Stat. § 135.02(3)(b) directs us

to the definition of "wholesaler" under Wis. Stat. § 125.02(21).3

Section 125.02(21) defines "[w]holesaler" as "a person, other

than a brewer, brewpub, manufacturer, or rectifier, who sells
alcohol beverages to a licensed retailer or to another person

who holds a permit to sell alcohol beverages at wholesale." The

dispute in this case revolves around whether wine is an "alcohol

beverage" as referenced in the "wholesaler" definition.

3
Wisconsin Stat. ch. 125 specifically governs the sale of
alcohol beverages in the State of Wisconsin and addresses the
importance of the three-tier system of "production,
distribution, and sale." See Wis. Stat. § 125.01.

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Section 125.02(1) defines "alcohol beverage" as "fermented malt

beverages and intoxicating liquor" and § 125.02(8) defines

"[i]ntoxicating liquor" as:

[A]ll ardent, spirituous, distilled or vinous liquors,
liquids or compounds, whether medicated, proprietary,
patented or not, and by whatever name called,
containing 0.5 percent or more of alcohol by volume,
which are beverages, but does not include "fermented
malt beverages".
(Emphasis added.) Everyone agrees that vinous liquors include

wine. Construing the text of these statutes leads to the

inexorable conclusion that the wine distributors are wholesalers

whose agreements with Winebow create dealerships protected by

ch. 135.

¶45 The majority decries this interpretive exercise as a

"practice" with "no clear stopping point." Majority op., ¶37.

While our judicial duty of declaring what a statute says would

be easier if each statutory chapter confined its subject matter

to that particular chapter, legislative enactments are rarely so

linear. On the scale of interpretive complexity, our task falls

on the easy end. Inexplicably, the majority maintains the key

definition from Wis. Stat. ch. 125 is not referenced within

ch. 135, see majority op., ¶37; this is of course inaccurate

because Wis. Stat. § 135.02(3)(b) explicitly references Wis.

Stat. § 125.02(21), which provides the definition of

"[w]holesaler." This cross-reference to ch. 125 (governing

alcohol beverages) within the rather brief ch. 135 requires no

more than reading three definitions within the same section of
ch. 125 (i.e., § 125.02), each of which is explicitly connected.

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Far from lacking a clear stopping point, the analysis requires

us to start with ch. 135 and end in one section of ch. 125. The

majority criticizes this statutory construction as "circuitous."

Majority op., ¶36. Following a single cross-reference to find

the meaning of a defined term is hardly circuitous; regardless

of how it is characterized, it is nonetheless the only correct

interpretation.

II

¶46 Although the text clearly leads to the conclusion that

ch. 135 applies to wine grantor-dealer relationships, the

Seventh Circuit certified the question because Wis. Stat.

§ 135.066(2)(a) provides a seemingly contradictory definition of

"[i]ntoxicating liquor."4 This conflicting definition, however,

does not override the definition of "[i]ntoxicating liquor"

within Wis. Stat. § 125.02(8).

¶47 First, the definition of intoxicating liquor in Wis.

Stat. § 135.066 contains no language suggesting that its

definition applies throughout ch. 135. In contrast, the
definition of "intoxicating liquor" embedded within

§ 135.02(3)(b) resides in the "definitions" section of ch. 135,

which specifically says that the definitions apply "in this

chapter"——that is, ch. 135. Because the definition of

intoxicating liquor that includes wine——which is rooted in Wis.

Stat. § 135.02(3)(b)——applies across the chapter, it is

4
Wisconsin Stat. § 135.066(2)(a) provides: "'Intoxicating
liquor' has the meaning given in s. 125.02(8) minus wine."

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textually insupportable to apply § 135.066's definition of

"intoxicating liquor" beyond the section it inhabits.

¶48 Second, in order to give effect to all the words used

within ch. 135, Wis. Stat. § 135.066's definition must be

limited to that particular section where it appears. Allowing

§ 135.066's definition to apply anywhere else would render the

"[i]n this chapter" language of Wis. Stat. § 135.02 superfluous.

If definitions outside of § 135.02 also applied throughout the

chapter, despite the absence of express language so directing,

§ 135.02's language rendering its definitions applicable "in

this chapter" would amount to a bootstrap provision at best,

merely emphasizing, but not controlling, the operation of

ch. 135's definitions. Because basic tenets of statutory

construction dictate avoiding surplusage, the majority errs in

its interpretation by creating overlapping definitions. See

Kelley Co. v. Marquardt, 172 Wis. 2d 234, 250, 493 N.W.2d 68

(1992) (we are to construe a statute, where possible, so that no

part of it is rendered superfluous); see also Antonin Scalia &
Bryan A. Garner, Reading Law: The Interpretation of Legal Texts

174 (2012) ("If possible, every word and every provision is to

be given effect (verba cum effectu sunt accipienda[ ]). None

should be ignored. None should needlessly be given an

interpretation that causes it to duplicate another provision or

to have no consequence."). The majority's creation of

overlapping but contradictory definitions requires it to select

one and ignore the other. This consequence is objectionable but
avoidable by giving effect to both definitions, as the text

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directs us: one applies throughout the chapter and the other

applies only within its own section.

¶49 Third, it is Wis. Stat. § 135.02(3) that defines

whether a relationship between a grantor and a dealer is a

"[d]ealership." Wisconsin Stat. § 135.066 does not.

¶50 The majority concludes that Wis. Stat. § 135.066's

definition of "[i]ntoxicating liquor" must apply across the

chapter, thereby removing ch. 135's protections from the two

wine distributors in this case, in order to give the definition

meaning. I disagree. The definition of "[i]ntoxicating liquor"

in § 135.066 retains a function even if limited to its specific

section of ch. 135. It applies to the legislative findings of

sub. (1), the non-applicability provisions of sub. (5), and the

severability part of sub. (6).

¶51 The effect of confining the Wis. Stat. § 135.066(2)(a)

definition of "[i]ntoxicating liquor" to § 135.066 may

contravene the Governor's intention in excising wine from that

definition. Regardless of what he intended in exercising his
partial veto power, this is what the Governor wrote. We give

effect to the text, not the intentions of its drafters. As a

result, under sub. (1), the legislative findings regarding the

three-tier system for distributing intoxicating liquor do not

apply to wine dealerships. Subsection (5) renders § 135.066

inapplicable to certain "intoxicating liquor" dealerships whose

production of "intoxicating liquor" does not exceed certain

thresholds in gallons or revenue. Because wine was struck from
the "intoxicating liquor" definition in § 135.066(2)(a), the

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non-applicability provision in sub. (5) does not apply to wine

dealerships. Finally, sub. (6) makes the provisions of

§ 135.066 severable; under Wis. Stat. § 990.001(11), this means

that if one section is declared invalid, the remaining sections

shall stand unaffected. Restricting the application of the

§ 135.066(2)(a) definition of "intoxicating liquor" to § 135.066

may not be what the Governor intended, but it is what he left of

the legislation in exercising his partial veto power. And it is

the text, not intentions, that reigns supreme. State ex rel.

Kalal, 271 Wis. 2d 633, ¶41 ("a 'policy favoring conventional

meanings and general understandings over obscurely

evidenced intention of the legislators is supported in the oft-

repeated premise that intention must be determined primarily

from the language of the statute itself'" (quoting 2A Norman J.

Singer, Sutherland Statutory Construction § 45.08, at 40 (6th

ed. 2000))); Scalia & Garner, supra ¶9, at 56 ("The words of a

governing text are of paramount concern, and what they convey,

in their context, is what the text means.").
¶52 The majority emphasizes the history of these statutes

before enactment by including the full text proposed by the

legislature, the strikethroughs made by the Governor's veto pen,

and the Governor's letter explaining the basis for his

substantial edits. Placing the focus on these non-textual

considerations improperly influenced the majority's statutory

construction. "It is always perilous to derive the meaning of

an adopted provision from another provision deleted in the
drafting process." District of Columbia v. Heller, 554 U.S.

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570, 590 (2008). This caution applies no less to provisions

deleted by the Governor exercising his veto power.

¶53 The majority underscores the legislature's ability to

amend the law if it in fact disagreed with certain treatises'

take on the effect of the Governor's partial vetoes to remove

wine wholesalers from the fair dealership law. This court has

explained that legislative acquiescence is a slim reed upon

which to support a judicial construction of a statute because

"[n]umerous variables, unrelated to conscious endorsement of a

statutory interpretation, may explain or cause legislative

inaction." Wenke v. Gehl Co., 2004 WI 103, ¶33, 274

Wis. 2d 220, 682 N.W.2d 405; see also Johnson v. Transp. Agency,

480 U.S. 616, 672 (1987) (Scalia, J., dissenting) ("[I]t [is]

impossible to assert with any degree of assurance that

congressional failure to act represents (1) approval of the

status quo, as opposed to (2) inability to agree upon how to

alter the status quo, (3) unawareness of the status quo, (4)

indifference to the status quo, or even (5) political
cowardice."). Our judicial duty is to say what the law is, not

to surmise meaning from legislative quiescence. Legislative

inaction cannot support an interpretation of the statute that is

contrary to the plain meaning of the language used in the

statute.

III

¶54 Applying a textual analysis of the language in ch. 135

leads to but one conclusion: wine distributors are wholesalers
as that term is defined in Wis. Stat. § 135.02. The majority

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fixates on what the Governor struck from the legislation rather

than what remained, thereby giving effect to what the Governor

intended rather than what he actually signed into law. Reading

the pertinent provisions of ch. 135 without the obfuscating

portions that did not survive the Governor's veto dissolves any

ambiguity. The majority adopts a statutory construction that

rewrites ch. 135 by subtracting language from it, rather than

giving effect to every word. The majority errs. I would answer

the certified question affirmatively, and therefore,

respectfully dissent.

¶55 I am authorized to state that Justices SHIRLEY S.

ABRAHAMSON and DANIEL KELLY join this dissent.

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