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New Crushpad Owners Ask Customers to Pay More

After DIY winery's assets are sold, buyers say retrieving stranded wine will require additional fees

Tim Fish
Posted: August 10, 2012

The new owners of Crushpad, the financially troubled custom-crush winery sold at auction on Aug. 7, say customers who want to rescue their barreled and bottled wines will have to help foot the bill for the company’s reorganization. That's leaving plenty of clients confused and angry.

“We cannot cover all the services that have already been paid for,” Philip Von Burg of CastleGate Capital Advisors told Wine Spectator. “That exceeds $3 million.” CastleGate, a Tiburon, Calif.-based firm specializing in turning around troubled companies, paid $654,866 for Crushpad’s assets and liabilities, which included all customer wine.

As many as 500 customers have wine in barrel at the do-it-yourself custom-crush winery, located at Sebastiani Winery in Sonoma. The company, founded in San Francisco in 2004, has struggled since the 2008 economic crisis. Since June, customers have been reporting that Crushpad would not let them remove wine from the facility, even though many had already paid to have the wines bottled and labeled.

Von Burg conceded that customers will have to pay additional expenses if they want to complete barrel aging and bottle their wines. The details are still being ironed out, but he said, “We’re offering to subsidize those expenses. We’re incurring a lot of expenses with liens and other things.”

Crushpad's new owners paid off a lien this week from Groskopf Warehouse, a nearby facility contracted to store wine already in the bottle, and customers can now pick up their case goods for a small service fee, Von Burg said.

Unsurprisingly, some Crushpad customers were not pleased. "Making clients who already paid for everything pay again to get assets that are theirs?" said one customer. "Essentially they have my wine hostage."

The company is scouting for a new location and is in the process of rehiring previously laid-off employees, Von Burg said. In the near term, Crushpad plans to use a third-party company to bottle the wines now in barrel. “We hope to be bottling in 30 days and plan to bottle through harvest and hopefully catch up,” he said.

Von Burg is now speaking with growers under contract—many of whom were unpaid for 2010 and 2011 harvests—with the goal of having a small crush in 2012.

“Generally the reaction from customers has been favorable, once we explain what we’re trying to do,” Von Burg said. “But for a few, nothing that we say will make them happy, so we’re just going to do our best.”

John Clendening
San Francisco, CA —  August 13, 2012 4:29pm ET
It is $3000 to get your wine finished. My sense is the new guys are business guys who are trying to right this thing.

I do wonder what recourse if any exists toward the prior owners. I feel very ripped off right now.
Robert Grover
Long Island, NY —  August 15, 2012 8:41am ET
If the wine was finished and paid for then just release it to the customer. To charge more midway through the process is not an honorable business practice.

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