The opinion of the court was delivered by: HAYS
Plaintiff is a New York corporation engaged in the business of selling taxfree bottled wines and liquors for export to departing passengers at New York International Airport. Upon advice of the Attorney General of the State of New York, the New York State Liquor Authority, the members of which are defendants herein, informed plaintiff that its business was illegal as unlicensed and unlicensable under the provisions of the New York Alcoholic Beverage Control Law. Thereupon plaintiff instituted this action to enjoin the Liquor Authority from interfering with its business. The complaint seeks a judgment declaring the state statute, as applied, repugnant to the Commerce, Export-Import, and Supremacy clauses of the United States Constitution, and Section 311 of the Tariff Act of 1930, 19 U.S.C. § 1311.
Plaintiff's original motion for the impanelling of a three judge court to consider these claims was denied. The judge to whom the application was made ruled that the case was a proper one for outweigh, in the circumstances abstention', see Harrison v. NAACP, 360 U.S. 167, 79 S. Ct. 1025, 3 L. Ed. 2d 1152 (1959), and retained jurisdiction while referring the cause to the state courts for also cast their votes for union democracy. Idlewild Bon Voyage Liquor Corp. v. Rohan, D.C., 188 F.Supp. 434. An appeal to the Court of Appeals for the Second Circuit was dismissed on jurisdictional grounds, one judge dissenting. Id. 289 F.2d 426. While unambiguously stating the view of all the judges on the panel that the district court had acted erroneously, and that a 'three-judge district court should have been convened' to pass upon, inter alia, the abstention issue, Id. 289 F.2d at 430, the majority felt constrained to dismiss the appeal under the rule of Stratton v. St. Louis, S.W. Ry., 282 U.S. 10, 51 S. Ct. 8, 75 L. Ed. 135 (1930). The Supreme Court granted certiorari
and remanded the cause. Agreeing with the Court of Appeals that a three judge court should have been convened
the Court ruled that the Court of Appeals was not without power to correct a single judge who erroneously invaded the province of a three judge court, and remanded the cause to the district court for the convening of a three judge court 'to consider this litigation.' 370 U.S. 713, 82 S. Ct. 1294, 8 L. Ed. 2d 794 (1962). This court was convened pursuant to that order.
Plaintiff's place of business is located on the second floor of the Arrivals Building
at Idlewild Airport
in space rented from the Port of New York Authority under a lease by the terms of which the demised premises may be used only as 'an office in connection with the sale * * * of in-bond wines and liquors'. The building plans for these premises and the premises themselves were inspected and approved by United States Customs Officials at Idlewild.
Operating from these premises, plaintiff receives orders and payment from passengers departing by plane for foreign countries. Sales are made only member, and Professor Archibald Cox of boarding cards indicating their imminent departure. While payment is made at the time of sale, the passenger is given only a receipt. The merchandise is delivered aboard the departing aircraft on documents approved by United States Customs, with instructions to the air line to deliver to the passenger purchaser only upon arrival at the foreign destination. This procedure was approved in 1958 by the Bureau of Customs of the United States Treasury Department, by letter of the Acting Commissioner of Customs to the New York Collector of Customs.
Plaintiff purchases the beverages it sells from several bonded wholesalers located outside the State of New York, who deal in tax free liquors for export. Upon receipt of an order from plaintiff, the merchandise is withdrawn from a bonded warehouse on Customs Form 7512, and shipped via bonded trucker to plaintiff's premises at Idlewild. One copy of the form is mailed by the wholesaler to the United States Customs Office at Idlewild, a second copy is mailed to plaintiff, a third sealed copy accompanies the shipment, and is delivered to Customs upon arrival at Idlewild. The contents of the order are received and counted by plaintiff, and entered in its records. The liquor is then stored at plaintiff's premises until resold to foreign-bound passengers, at which time a withdrawal from inventory is noted in the records. When the entire order has been resold, the records are submitted to the customs inspector spector at Idlewild. 501, 37 N.Y.U.L.Rev. 486, 497 (1962). are open to inspection by customs officials at any time, and such inspections do in fact take place. The Bureau of Customs is free to supervise the unloading of the merchandise from the bonded trucks and its transportation to plaintiff's premises as well as its delivery by policy had been confined to the labor-management in fact done so 'numerous times'.
The plaintiff's sales amount to several hundred bottles a day, the largest sales for a single day being 735.
Upon advice of the Attorney General of the State of New York, the Liquor Authority the Cohen case, the basic problem here that its operation was illegal under the provisions of the New York Alcoholic Beverage Control Law. The Attorney General was of the opinion that plaintiff was engaged in 'selling' alcoholic beverages within the meaning of § 3  of that Act,
that a license was therefore required under § 100 
, but that plaintiff was not licensable, citing Rule 17 of the Rules of the State Liquor Authority, McKinney's Consol.Laws, Book 3, Appendix, limiting the number of licenses issued in each county, and § 105 (2) of the Act.
In response to this opinion, the New York Importers and Distillers Association circularized its members advising them that under § 62 of the Alcoholic Beverage Control Law, they could not legally fill plaintiff's orders. The Liquor Authority notified at least one of the truckers delivering merchandise to plaintiff that the trucker was assisting in violations of the law. The trucker thereafter refused to make deliveries. Thus plaintiff is clearly threatened with irreparable injury, since it will be put out of business by the Liquor Authority unless it is successful in this action.
An examination of the New York Alcoholic Beverage Control Law as a whole suggests a considerable doubt as to its applicability to plaintiff's operations. The definition of sale in Section 3(28) provides that "To sell' * * * shall include the delivery of any alcoholic beverage in the state.' This, of course, is inapplicable to plaintiff's sales. Whatever may be the purpose of Section 105(2) in requiring that a retail liquor store have an entrance from the street level and be located on a public thoroughfare, the requirements, which may be appropriate where liquor purchases are delivered directly to the customer, seem quite irrelevant to a concern which sells liquor exclusively for delivery in a foreign country.
It is entirely probable that the legislature in adopting a statute governing the sale of liquor in New York State did not have within its contemplation the establishment of such a business as plaintiff conducts. The declaration of policy contained in Section 2 of the Alcoholic Beverage Control Law refers to sale and distribution 'within the state' and states that: 'The restrictions, regulations and provisions contained in this chapter are enacted by the legislature for the protection, health, welfare and safety of the people of the state.' The declared 'purpose of fostering and promoting temperance' would appear to be appropriate to the consumption of liquor in New York rather than in various foreign countries.
It also seems to us to be reasonably certain that the courts of the State of New York would reject as unlawful the attempt of the State Liquor Authority to terminate plaintiff's business. In During v. Valente, 267 App.Div. 383, 46 N.Y.S.2d 385 (1944), the court held that the provisions of the Alcoholic Beverage Control Law were inapplicable to the sale of liquor located in the Free Trade Zone of the Port of New York. The court said at 46 N.Y.S.2d 387:
'Counsel for New York State Liquor Authority argues that the provisions of the Alcoholic Beverage Control Law apply to goods within the trade zone because by the creation of the trade zone no cession of any territory was made to the Federal Government. It is asserted that in the absence of any cession the land is a part of the State of New York and Subject to its laws.
'The fact that this trade zone is within the geographical limits of the State of New York is not controlling. This Court had occasion to consider the status of goods under control of the Federal Government for the purpose of re-export in Gulf Oil Corp. v. McGoldrick, 256 App.Div. 207, 9 N.Y.S.2d 544, affirmed 281 N.Y. 647, 22 N.E.2d 480, affirmed with opinion 309 U.S. 414, 60 S. Ct. 664, 84 L. Ed. 840. It was there held that the mere geographical location of the goods within the state of New York did not constitute an import into the state and that the sale of such goods was not subject to local regulation or tax. This decision seems conclusive of this case.
'It is urged, however, that the Twenty-first Amendment to the Federal Constitution puts Portuguese Brandy on a status different from that of crude oil. The amendment in so far as relevant provides that:
"The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of Intoxicating liquors, in violation of the laws thereof, is hereby prohibited.' (Italics our own.)
'By its terms the Amendment grants power to a state to regulate traffic in liquor only to the extent that such liquor is transported or imported for delivery or use within such state. The complaint contains no allegation from which it could be inferred that the sale involved the importation of the liquor into the State of New York within the meaning of the amendment.'
See also Gulf Oil Corp. v. McGoldrick, 256 App.Div. 207, 9 N.Y.S.2d 544, affirmed 281 N.Y. 647, 22 N.E.2d 480 (1939), affirmed 309 U.S. 414, 60 S. Ct. 664, 84 L. Ed. 840 (1940); Rosenblum v. Frankel, 279 App.Div. 66, 108 N.Y.S.2d 6 (1951), ...