Billionaire Sues Major Collector

In separate action, Christie's Broadbent sues book publisher
Sep 11, 2009

Two new lawsuits have thrust the issue of counterfeit wines back into the spotlight, raising new questions about the wine-auction market just as the fall auction season begins and the market shows signs of a possible recovery.

Billionaire William Koch filed suit in Los Angeles Superior Court Thursday against Rudy Kurniawan, accusing the Indonesia-born wine collector of fraud, citing five bottles of Bordeaux and Burgundy Koch bought from auction house Acker, Merrall & Condit in 2005 and 2006 that he later learned came from Kurniawan and that he claims are fakes.

On the other side of the Atlantic, British wine critic Michael Broadbent filed a lawsuit in July against Random House, the publishers of The Billionaire's Vinegar by Benjamin Wallace, a book exploring the tangled story of the so-called Jefferson Bordeauxs, wines sold by German dealer Hardy Rodenstock that were supposedly ordered for Thomas Jefferson in the 18th century. As head of Christie's wine-auction department until 1992, Broadbent sold some of the Rodenstock wines. Broadbent is suing Random House for libel and defamation over how he is portrayed in the book.

Koch's suit against Kurniawan is not his first salvo over alleged counterfeits. For several years now, the problem of counterfeit wines has been a crusade for the Florida energy executive. He is currently suing Rodenstock in New York over four of the Jefferson bottles, which he bought from London and Chicago retailers and alleges are fakes.

After hiring investigators to comb his 35,000 bottle cellar, Koch has filed multiple suits, including cases against New York auction house Zachys, collector Eric Greenberg and Acker. "Rodenstock is just the tip of the iceberg," Koch told Wine Spectator in 2007. "I plan to put people in jail, I plan to get my money back, and I plan to force the auction houses and retailers to make serious changes."

Since filing suit against Acker, Koch has tried to find the source of the wines he bought from the auction house. "We just learned last week in discovery what we suspected all along: Rudy was the consignor of all the fake wines that Koch purchased," said Brad Goldstein, a spokesman for Koch, explaining the timing of the latest suit.

Kurniawan has been a major collector at auctions since as early as 2005, attending many sales and collector dinners and spending millions of dollars on wine. He was the source for two of Acker's biggest auctions, in January and October 2006. The latter grossed $24.7 million, a record at the time. He opened a retail store in Los Angeles called Terroir.

In April 2008, multiple lots of Burgundy from Domaine Ponsot were pulled from an Acker auction after proprietor Laurent Ponsot called Acker president John Kapon to say the wine was fake. The wines were from Kurniawan's cellar. That prompted Koch, in his suit against Acker, to ask whether any of the wines he had bought from the auction house were consigned by Kurniawan.

In his lawsuit, Koch accuses Kurniawan of selling him five fake wines through Acker at auctions and private sales, including a bottle of 1947 Château Pétrus, a bottle of 1945 Comte Georges de Vogüé Musigny Cuvée Vielles Vignes and two bottles of 1934 Domaine de la Romanée-Conti. The filing does not specify how Koch knows the bottles are fakes. Koch also alleges that Kurniawan was systematically buying and selling wine to inflate the auction market and that he sold fakes to other unsuspecting collectors. Koch has not specified what damages he is seeking.

Broadbent Strikes Back

Broadbent's suit is just the latest chapter in the Jefferson bottle saga. Wallace's book, published last year, investigated the Jefferson bottles (the first of which went on the auction block in December 1985 and sold for a record $156,000) and Rodenstock's career uncovering rare old wines. Because he auctioned the first Jefferson wine sold and tasted several of them, Broadbent is a major figure in the book.

According to the lawsuit, filed with the High Court of Justice, Queen's Bench Division, and obtained by Wine Spectator, Broadbent objects to the way he is portrayed in several passages. The suit alleges these sections imply that Broadbent auctioned wine he knew was fake and had questionable ties to Rodenstock.

Broadbent's lawyer, Sarah Webb, repeatedly declined interview requests but told a British paper, "The book contains serious defamatory allegations about my client, alleging fraud and dishonesty. The book was published by Random House in America, but is available here—it has sold around 2,000 copies in Britain—so we are suing for libel in Britain." Great Britain is known for having lenient libel laws, making suits easier for plaintiffs. Random House refused comment. The case is expected to reach court next year.

Collecting Crime Fraud News

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