The Australian BRL Hardy and the American group Constellation Brands plan a merger, this financial operation would create the world #1 of the wine industry. On January 17th, 2002 the Administration Council of BRL Hardy accepted a purchase offer presented by Constellation Brands. The total amount of the operation should be nearly two billions of Australian dollars (approximately one billion of Euros). The merge of BRL Hardy, first producer of Australian wine and the wine branch of Constellation (also present in spirits and beer industry) within a new unit, Constellation Wines. This one will get a turnover of 1,6 billion of Euros, which will place it in front of the American Gallo. It will be #1 in Great Britain and Australia, #2 in the United States. However the merge needs to obtain the authorization of BRL Hardy shareholders and several authorities of trade regulation in Australia and in the United States.
Supreme Defeat for ‘Two Buck Chuck’ Maker
It’s final. Bronco Wine Co. will no longer be able to use “Napa” in the brand names of wines made with few or no Napa grapes. Today 23rd January, the U.S. Supreme Court denied without comment Bronco’s last-gasp effort to overturn a California labelling law, ending more than five years of litigation and handing a victory to California state authorities and the Napa Valley Vintners.
“We’re elated and grateful that the Supreme Court let the lower court’s decision stand,” said Linda Reiff, executive director of the NVV, a marketing organization of 270 wineries that spent about $1.5 million on the litigation. “It’s a concept that’s easy to understand and easy to support—that if a wine says ‘Napa’ on the label it should be Napa in the bottle.”
Today’s decision was expected, because the high court hears only about 1 percent of the cases submitted for appeal. Neither Fred Franzia, CEO of Ceres, Calif.-based Bronco, nor his Washington, D.C.-based attorney, Peter Brody, returned calls seeking comment.
The litigation was Bronco’s attempt to overturn a September 2000 California law that closes a loophole in federal wine-labelling regulations. Federal law dictates that at least 75 percent of the grapes in a wine with a geographic brand name must come from the referenced region, but a grandfather clause exempted brands established prior to July 7, 1986. California eliminated that exemption for brands that refer to Napa or any of its subappellations. Bronco, a mass-market producer best known for its Charles Shaw (“Two-Buck Chuck”) label, owns three such brands—Napa Ridge, Napa Creek and Rutherford Vintners—which it has been making primarily, if not exclusively, with grapes from California’s Central Valley, where Franzia owns around 40,000 acres of vineyards.
The state law has not yet been enforced, due to a stay that was instituted when Bronco filed its suit. The California attorney general must first lift that stay, and state officials must also determine the fate of the Napa Ridge, Napa Creek and Rutherford Vintners wines that are in distribution but not yet sold. “It all depends on how much inventory is in the [distribution] system,” said Jerry Jolly, director of the California Department of Alcohol Beverage Control, which will be responsible for enforcement of the law. “We hope [Bronco] anticipated this and their inventories are low. But we’ll need to meet with them. It will take some time to work this out.”
After the initial passage of the California law, Bronco had three choices. It could discontinue the brands in question, from which, according to court documents, it earned $17 million a year. It could comply with the law and start making the brands with Napa grapes, which are substantially more expensive than Central Valley grapes. Or it could fight the law in court in an attempt to overturn it.
Bronco chose the final option and challenged the law on four separate constitutional grounds: that the federal grandfather clause preempts a California state law; that the state law curtailed Bronco’s First Amendment right to free speech; that it violated the Commerce Clause against unreasonable restrictions on interstate business; and that it violated due process by taking Bronco’s brand value without compensation.
Bronco won the first round in December 2002, when California’s Third District Court of Appeal in Sacramento struck down the law on the federal preemption issue. However, the court did not rule on the other three challenges.
That turned out to be Bronco’s only triumph in the litigation. The Supreme Court of California heard the case on appeal in May 2004, then issued its unanimous ruling against Bronco that August. Bronco filed a petition for appeal with the U.S. Supreme Court, which was denied in March 2005.
But the courts had only ruled on the federal preemption issue. Bronco pursued its other three constitutional challenges, which were denied in May 2005, as was a request for appeal of that decision with the Supreme Court of California.
January 23, 2007 – The Brewers Association Export Development Program (EDP) announced today the participation of 19 Brewers Association members and EDP subscribers in this year’s Australian International Beer Awards (AIBA). www.beerawards.com.
Held in Melbourne each year, the AIBA is Australia’s most prestigious beer event and has become firmly established on the international brewing calendar as a renowned and recognized barometer of excellence and diversity in beer brewing across the world. In 2006, the Australian International Beer Awards attracted 974 entries from 31 countries. AIBA uses the Brewers Association’s Beer Style Guidelines.
The Brewers Association’s Export Development Program, in an effort to help promote the image of American craft beer as a world class beverage, pays for entry fees and transportation into select international beer shows for its program subscribers, such as the AIBA.
“Assisting US craft breweries with participation in large international competitions like AIBA is a major focus of the EDP,” says Brewers Association vice president Bob Pease. “Our work for EDP subscribers allows us to allocate funds for their entry fees and cover the cost of a consolidated beer shipment to the competitions. US craft beers typically perform well on the international stage and the awards they receive bring attention to the brands and to the US industry as a whole. ”
Judging takes place in March in Melbourne with winners announced April 19.
United States Doctors Targets For Multimillion Dollar Wine Fraud
Two UK company directors have been disqualified for 15 years for their part in an ingenious £80m wine and spirit investment scam targeting American doctors.
Following a trial in the High Court, Robin Grove and Richard Gunter, directors of Vintage Hallmark plc were found by Judge Richard Havery to be “utterly unfit to be concerned in the management of a company”.
The two were disqualified as directors until December 2021.
Vintage Hallmark plc went bankrupt on 22 January 2003 owing just short of £80m (US$158m).
Second Growth Bordeaux Wine Under Screw-Cap
A Bordeaux second growth chateau will be bottling wine under screwcap, it was revealed today, January 22, 2007.
United Kingdom wine merchant Bibendum said 12,000 bottles of Les Tourelles de Longueville, the second wine of Paulliac chateau Pichon-Longueville, will be bottled with the closure.
The Deluxe Stelvin-topped wines are destined for British restaurants and bars where Bibendum distributes Les Tourelles exclusively to the United Kingdom on-trade.
The wines will be officially released on 1 April but are available now. The first wines under the new closure will be from the 2004 vintage.
The move follows pressure by Bibendum on the producers and distributors of Pichon-Longueville to trial screwcap.
Barrels From Ancient Felled Oak to Make Chateau Latour Wine
Owners of some of the world’s grandest vineyards gather today, January 20, 2006, to witness the felling of a 340-year-old oak that will be made into barrels for ageing their wine.
The 120-ft Morat tree was planted in about 1665 in the Forêt de Tronçais, on the edge of the Massif Central, in the reign of Louis XIV. It is the finest surviving specimen of the king’s programme to develop the perfect oak, tall and straight without knots or kinks for use in building ships.
The National Forestry Office decided to fell the Morat last autumn after it began losing a battle against the great capricorn, a boring beetle. Their aim was to make use of the timber before it deteriorated further. The fine grain wood of the slow-growing sessile oak (quercus petraea) is prized by wine-makers for the flavours that it bestows during ageing.
It was sold by auction for £25,500 to Jean-Luc Sylvain, whose firm is to make more than 60 traditional 225-litre (300 bottle) Bordeaux barrels. These have already been sold to the owners of grands crus including Château Angelus and Château Latour as well as Californian, Chilean, Spanish and Italian winemakers.
“They will be able to draw on the barrels for wine from the 2008 vintage,” M Sylvain said. “The Tronçais oaks activate delicate, fruity flavours close to vanilla and coconut. The Morat barrels will be numbered and circled with chestnut. They will be museum pieces.”
French wine may be losing its market abroad, but the quality of French wood is still unmatched for making barrels, M Sylvain told Le Monde.
The Morat, named after a forester who once tended it, is the most magnificent of the 13 remaining oaks from the plantation supervised by Jean-Baptiste Colbert, the Financial Comptroller of the Sun King and the man who created France’s centrally administered state. Out of 50,000 that were planted, all but 1,500 were removed after 50 years, leaving only the finest specimens.
The Treasury came under pressure yesterday – 20th January, 2004 to prove its assertion that the spirits industry was losing £600 million a year through fraud.
The call came as MPs from all sides of the House called on Gordon Brown to withdraw plans to introduce tax stamps on Scottish whisky and other British spirit manufacturers.
The Chancellor is threatening to introduce the strip stamps in this Spring’s budget unless the spirits industry can come forward with alternative suggestions for tackling fraud – which the Treasury has estimated costs the taxpayer £600 million a year.
But a succession of MPs yesterday contested the scale of the problem and the suggestion that the strip stamps were the most effective way of combating fraud.