Kelly J. Hayes: WineInk
Sacrebleu!That’s likely what Agatha Christie’s fictional detective Hercule Poirot would exclaim upon learning of the great wine fraud perpetrated on the E&J Gallo Company by a consortium of French wine traders that was adjudicated in the courts of Carcassonne this week.Sacrebleu, indeed. A French court on Feb. 17 convicted a dozen rascally, conniving wine thieves of selling as many as 3.57 million gallons, equal to about 18 million bottles of wine, to the Modesto, Calif.-based E&J Gallo under false pretenses. The wine was sold as Pinot Noir when it actually consisted of Syrah and Merlot, grapes that sell for far less on the open market.The fraud took place from January 2006 to March 2008. It saw grapes from the Languedoc-Roussillon region of Southwestern France sold and shipped to Gallo for inclusion in their “Red Bicyclette” brand.Gallo stated that no more than 20 percent of the fraudulent wine was used in their bottlings and that no vintage later than 2006 was affected.There is no indication that Gallo had any involvement in the fraud other than being duped by their French partners, and though Gallo was not a participant in the French court proceedings, they have indicated that they will work with U.S. authorities to determine if any of the wine is still in the marketplace.The French defendants in the case included executives from the wine exporting conglomerate Sieur d’Arques and Claude Courset, the head of wine merchant Ducasse. Assorted brokers, growers and estates were also among those charged.The allegations state that there was a conspiracy hatched by Courset to buy cheaper grapes, alter records and have Sieur d’Arques ship the grapes to Gallo as the more expensive Pinot Noir. The judge who handed down the verdict said Ducasse took in as much as $5 million in profits and Sieur d’Arques profited as much as $1.75 million.And yet those convicted received fines ranging from just $2,000 to $244,000 and suspended sentences that range from one- to six-month jail terms. Appeals may be pending.Gallo launched the Red Bicyclette brand in 2004 to capitalize on the success of the “Sideways” craze and celebrate the beauty of Pinot Noir. The brand is affordable, with bottles selling for $12 or so, and bottlings include other varietals as well, all from the region where the fraud was hatched. As Gallo’s website waxes poetically:”Every bottle comes from Languedoc-Roussillon, a beautiful region on France’s Western Mediterranean coast. With a legacy of winemaking that dates back more than 2,000 years to the Romans, the 700,000 acres of Languedoc produce more vin than any other region in France.”The brand has been extraordinarily successful and the financial damage remains to be seen. But it is obvious that the winemaking giant took its eye off the ball. Evidently there was not a single customer complaint, but shouldn’t Gallo have people checking their plonk for constancy? Don’t consumers have a reasonable expectation that Gallo should know what it puts into its bottles?Wine fraud is nothing new. At the high end of the spectrum, the courts are filling with rich people suing other rich people over fraudulent bottlings of collectable wines. And now, at the low end, we discover that those who wish to exploit the market can make it up on volume.Gallo and the U.S. consumers who put down their money to buy the misrepresented wines are clearly the direct victims here. But perhaps even more important are the consequences that such a scandal heaps upon an entire industry. Wine growers who were not involved in the Languedoc-Roussillon become tainted by this action. The entire French wine industry is eyed with caution. The Americans who sell wines come under greater scrutiny.The message sent, of course, is “Drinkers, beware.” And all that is handed down are suspended sentences and fines that don’t approach the profits of the scam?The people who run the world of juice need to get out front on this scandal and make sure that they are transparent and accountable. In the 1980s the Austrian wine industry was nearly destroyed when it was discovered that some winemakers were adding tiny amounts of diethylene glycol to sweeten their wines. It took nearly 30 years for the region to recover from the fraud.Let’s hope a lesson has been learned and that Gallo, the French justice system, the growers and negociants of France and the powers that be throughout the wine world learn a lesson from this travesty.Perhaps we need a Hercule Poirot now more than ever.
Kelly J. Hayes lives in the soon-to-be designated appellation of Old Snowmass with his wife, Linda, and a black Lab named Vino. He can be reached at email@example.com.
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