Unfiltered: Judge Rules Phelps Vineyards Must Pay $24M to Former Execs
Plus, Foster's Group's wine division not for sale … yet, Marco Fantinel rings the NASDAQ opening bell, Napa Valley Grapegrowers crown a pruning champion, and Clos du Bois supports women's heart disease awareness
Posted: February 19, 2009
• A drawn-out dispute over compensation between Napa's famed Joseph Phelps Vineyards and two former longtime executives seems to have finally come to an end. Confirming a decision previously handed down by an arbitration judge, a San Francisco superior court judge ruled this month that Phelps must pay $24 million (plus interest), split almost equally, to former CEO Tom Shelton and former winemaker Craig Williams, who both resigned in 2008. The ruling closes a difficult chapter for all families involved; the dispute began in 2007 and included fraud and breach of contract claims being filed against both Shelton and Williams (the arbitrator rejected those claims). Shelton died before the matter was settled, succumbing to brain cancer in July 2008. The $24 million sum was based on the equity stakes in Phelps that Shelton and Williams had received in 1999. The Phelps family had sought to devalue Shelton's and Williams' shares, as well as block the sale of those shares to a third party. The Shelton family has more to smile about this month, as the late wine industry advocate will posthumously receive the Grape Liberator award, for service to the wine industry and the direct-to-consumer wine shipping movement, at a shipping symposium next week in Napa Valley.
• It's hard to know what to make of the news this week from Foster's Group. Despite rumors to the contrary, the Australian beverage giant announced Monday that it is not selling its underperforming (though profitable) wine division, which includes dozens of labels such as Beringer and Chateau St. Jean in the United States and Penfolds and Lindemans in Australia. Yet Foster's seems to be restructuring its wine business in a way that will allow it to sell it off, perhaps in chunks. First, the company's wine division and much-more-profitable beer business are being spun off into two separate entities. Also, winemaking is being consolidated into neat little packages. Beringer's St. Helena facility, for example, will now solely produce high-end wines like Private Reserve, while the production of value labels like Founder's Estate is shifting to the company's Asti facility in Sonoma, where the company already produces Souverain. Few details were available this week, but Foster's has said it will sell 36 marginal vineyards in California and Australia and close three winery facilities Down Under. The company had previously said it was closing a custom-crush facility in California's Central Coast and moving production of the Taz label from there to its nearby Meridian winery. For now, the industry waits to see what Foster's will do next.
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| Here's to a stable stock market! Oh, and ending world hunger, too. |
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• There may not be a lot to celebrate on the floors of the stock market this month (or last month, or the one before that …), but that didn't keep one winery owner from raising a glass to a new day of trading. Unfiltered recently spotted Marco Fantinel, president of Fantinel winery, based in Friuli, Italy, ringing the opening bell of the NASDAQ stock market. Fantinel, who is a United Nations Goodwill Ambassador, presided over the start of trading on Feb. 5 to commemorate the launch of the winery's Celebrate Life Merlot to help malnourished populations around the world. The Celebrate Life Campaign was created in early 2008 to support the U.N.'s Intergovernmental Institution for the use of Micro-Algae Spirulina Against Malnutrition (IIMSAM). For every bottle sold of the Celebrate Life Merlot, Fantinel is donating $1 directly to the IIMSAM to help it process and distribute spirulina, an algae that can be used as a food supplement and is high in nutrients, vitamins and proteins. Cheers to stemming the tide of world hunger with a bottle of wine.
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| Juan Gallegos shows off his championship pruning skills. |
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• Winter in the vineyards is traditionally a quiet time, when vintners pray for rain and not much else happens. But winter is also when the competitive pruning season begins, and Unfiltered is hooked. Pruning is hardly the sexiest of vineyard practices—it's meticulous work to remove old deadwood, vine by vine. But add a little friendly competition, and it suddenly becomes a spectator sport. We've reported on the high-school pruning finals in the past, but last week the Napa Valley Grapegrowers held its eighth annual Napa County Pruning Contest in Yountville. Juan Gallegos for Usibelli Vineyards took the first-place prize, which included a custom trophy buckle. (Think of it as the Super Bowl ring for pruners.) Out of 59 contestants, he came in first in both speed and quality of pruning. In about three minutes, Gallegos was able to prune five Cabernet Sauvignon vines, which were later scrutinized by judges, who naturally took much longer to critique the pruned vines than it took for them to be pruned. Napa Valley Grapegrowers program director Sonya DeLuca said the contest showcases the hard work of the vineyard workers, and that there was plenty of cheering from the sidelines. Unfiltered just hopes the Pruners' Union can keep the prima donnas and performance-enhancing drugs out of this glamorous new sport.
• The link between wine and health is well-documented, but Clos du Bois is working to make it a little stronger. The winery is promoting awareness of heart disease in women—which accounts for nearly one-third of all female deaths in the United States every year—by donating $1 to heart disease research for every free e-card sent from toasttowomen.com. The website also features heart-healthy recipes and menu ideas. That's something we can all raise a glass (and send an e-card) to.
