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High Wines and Misdemeanors Update: Drinker Files Class Action

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By Tanya Roth, Esq. on March 09, 2010 1:10 PM

This is a growing scandal, sending out small tendrils of lawsuits where ever it can. As discussed in a prior post, the American wine maker Gallo was shocked, shocked to find that its wine producers in France were selling what Gallo believed to be French Pinot Noir, only to discover it was a less expensive wine instead. Gallo of course, sold the wine they received from the French fraudsters as Pinot, which lead to the current law suit, for wine fraud, filed last week in a California court.

Wine merchant Sieur d 'Arques (along with others) was already convicted of fraud by the French court and is now a co-defendant along with Gallo in the suit by plaintiff Mark Zeller, presumably a wine drinker. According to the report by Wine Industry Insightthe suit alleges that Gallo acted more as a conduit of the fraud rather than another victim. The suit claims, "Defendants materially misrepresented the falsely labeled wine as Pinot Noir when they knew that the wine they labeled, marketed, promoted, distributed, and sold was not actually Pinot Noir wine. This substantially increased their profits." It might be worth noting though, at the time the French defendants were sentenced, one commentator noticed that not one American wine drinker, nor for that matter anyone at Gallo, noticed anything peculiar about the supposed "Pinot" during the entire two year period the wine fraud was active.  

Zeller is seeking class action status for his suit, on behalf of all California wine consumers.

Wine Industry Insight reports that Gallo would not comment on the suit, but Gallo's Vice President of Public Relations, Susan Hensley, said in a previously released statement, "We believe that the only French Pinot Noir that was potentially misrepresented to us, would have been the 2006 vintage and prior," Hensley said. "We will continue to work with the appropriate U.S. authorities to determine any next steps required for potentially mislabeled Pinot Noir in the marketplace."

Gallo looks to be in a difficult spot here. Either they must admit all over again that they were the complete dupes of a few wily wine exporters, or that they intentionally defrauded their own customers. Neither is a very palatable alternative.

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