Supreme Court Ruling Sheds New Light on Mondavi-Espy Case

Apr 29, 1999
Last year, Robert Mondavi Winery paid $150,000 in fines to the federal government for allegedly giving illegal gifts -- dinner and six bottles of wine -- to former U.S. Secretary of Agriculture Michael Espy. But yesterday, the U.S. Supreme Court rejected the legal argument behind the prosecution of Espy and those who gave him gifts. In doing so, the court cleared up years of confusion over ambiguity in the federal gratuity law.

"I believe this ruling totally vindicates us," said CEO Michael Mondavi. "The independent counsel has a responsibility to return our fine, pay our attorneys' fees and offer a letter of apology."

The statute as written prohibits giving a gift or promise of "anything of value" to a public official "for or because of any official act performed or to be performed by such public official." In a case brought by a California agricultural cooperative that was convicted of giving Espy illegal gratuities, the court ruled that there must be a clear connection between the gifts and the official acts (something never demonstrated in the Mondavi case). Simply giving a gift to a federal official does not violate the law.

"I'm not surprised [at the ruling]," Mondavi said. "I'm very pleased." The vintner noted that his winery was pressured by "heavy guns" to capitulate to the government. "We did no wrong. We were punished," he said.

Espy was forced out of his Cabinet position in 1994 after reports that he had accepted free travel, event tickets and other gratuities prohibited to executive branch members. The case against Mondavi grew out of a government investigation into Espy's activities by independent counsel Donald Smaltz.

The value of Mondavi's gifts to Espy amounted to less than $400. But to avoid criminal charges, the company settled the case, paying $100,000 in civil damages to the U.S. Treasury, $20,000 to cover the legal costs and $30,000 to fund a program on ethics at a California business school. Espy was later cleared of all charges against him; however, Mondavi still paid its fine.

Related stories:

  • July 22, 1998
    $394 in Gifts Nets Mondavi $120,000 in Federal Fines

  • September 14, 1998
    Unfiltered, Unfined: Let the Punishment Fit the Crime

  • December 28, 1998
    Unfiltered, Unfined: Looking Back at the Future

  • News

    You Might Also Like

    Charting a Path Forward: A Live Chat with Mac McDonald

    Charting a Path Forward: A Live Chat with Mac McDonald

    The pioneering Vision Cellars owner and winemaker opens up about his journey from East …

    Aug 11, 2020
    Young Owners of Le Clos du Caillou Expand in Châteauneuf-du-Pape

    Young Owners of Le Clos du Caillou Expand in Châteauneuf-du-Pape

    The Vacheron family has purchased Domaine de Panisse and 33 acres of prime vineyards

    Aug 10, 2020
    Leading Vintners in Châteauneuf-du-Pape Make Two Big Acquisitions

    Leading Vintners in Châteauneuf-du-Pape Make Two Big Acquisitions

    The Guigal family has purchased Domaine Les Clefs d'Or in Châteauneuf-du-Pâpe, while the …

    Aug 6, 2020
    Leading from the Top: A Live Chat with Carlton McCoy

    Leading from the Top: A Live Chat with Carlton McCoy

    The CEO of Napa's Heitz Cellar talks about his incredible journey from high-school dropout …

    Aug 6, 2020
    U.S. Dietary Guidelines Panel Takes Aim at Moderate Wine Drinkers

    U.S. Dietary Guidelines Panel Takes Aim at Moderate Wine Drinkers

    Proposed new guidelines would cut recommended daily limit of alcohol consumption for …

    Aug 5, 2020
    A Wine Industry on the Edge: Live Chat with Anthony Hamilton Russell

    A Wine Industry on the Edge: Live Chat with Anthony Hamilton Russell

    The South African vintner talks about taking the reins as owner of Hamilton Russell …

    Aug 4, 2020