McNutt v. U.S. Department of Justice

On December 18, the Liberty Justice Center filed an amicus brief in the U.S. Court of Appeals for the Fifth Circuit in McNutt v. U.S. Department of Justice. The lawsuit challenges a nineteenth-century law that banned at-home distilling, but the Liberty Justice Center’s brief explains that the case has far-reaching implications for the extent of the federal government’s taxing power.

In December 2023, a group of hobby distillers filed a legal challenge to an 1868 federal prohibition on at-home distilling after one of their members received a letter from the Tobacco, Tax, & Trade Bureau accusing him of committing a crime by purchasing ingredients that could be used to distill spirits at home. The group’s lawsuit argues that the federal government may not control citizens’ private actions within their own homes just because those actions could theoretically generate taxable revenue.

In July, a Texas federal district court ruled in the hobby distillers’ favor, finding that the prohibition was unconstitutional because it violated the Commerce Clause and exceeded the government’s taxing authority. The government appealed this ruling to the Fifth Circuit Court.

On December 18, the Liberty Justice Center filed an amicus brief urging the Fifth Circuit to uphold the lower court’s decision and affirm that the prohibition is unconstitutional.

The Liberty Justice Center’s amicus brief argues that the government’s broad interpretation of the taxing power lacks a coherent limiting principle and does not sufficiently protect individuals against unconstitutional tax schemes. Under the government’s view in the case, the U.S. government could claim that any regulation that simplifies tax collection—no matter how broad and no matter how far it infringed onto Americans’ rights—could be excused as a valid exercise of the taxing power.

“The government could use this broad definition of the taxing power to place egregiously patronizing and intrusive restrictions on how Americans live and earn—which is especially dangerous given the growing prevalence of self-employment, remote work, and other work-from-home opportunities,” said Reilly Stephens, Counsel at the Liberty Justice Center. “Ultimately, the government’s prohibition on home-distilled spirits does not hold water—or bathtub gin—as a necessary and proper exercise of the taxing power. The Court of Appeals should uphold the lower court’s ruling and find this prohibition unconstitutional.”

The Liberty Justice Center’s amicus brief in McNutt v. U.S. Department of Justice is available here.