Wineries take their case to ABC

By JACK HEEGER
Register Staff Writer

The fate of three Napa Valley vintners accused of pouring wine without the proper license at a fundraising event remains undecided after a hearing Tuesday.

More than 30 people, most offering support to the vintners, overflowed the tiny room in the Napa County building where the hearing took place.

The state’s Alcoholic Beverage Control board’s accusations against the trio — Eagle Eye Wines, Elkhorn Peak Cellars and StoneFly Vineyard — stem from their participation in the Tiburon Wine Festival in May. They’re accused of pouring wine at an event attended by consumers, which is not specifically allowed by their licenses.

The wineries contend that application of the law would be unfair to small operators and would chill a common form of charitable giving in wine country and elsewhere, in which small wineries provide wines for auctions or for tasting to raise money for community causes.

An administrative law judge will render his decision within 30 days and forward it to ABC offices in Sacramento, where it will be reviewed within 100 days.

The three wineries hold type 17 or “wholesaler” licenses, often issued to wineries without physical plants. Larger wineries operating winemaking facilities traditionally receive type 02 licenses specifically granting the wineries’ approval to pour at consumer events and donate to charities.

Georgia Kirchmaier, executive manager of the Tiburon Chamber of Commerce, said the Tiburon Wine Festival has been ongoing for 23 years. The attraction of the event for consumers is the number of small wineries, she said. She acknowledged while the wineries may be there to gain exposure, they also help the chamber with its fundraiser.

Michael Mann, administrator for the ABC’s Santa Rosa district, covering Napa County, said his office “had received complaints from the wine industry, from wineries” asking why the ABC “is allowing wholesalers to participate.” He said there were “three or four” such complaints continuing over time.

“There is nothing in the current law that would allow wholesalers to conduct a wine tasting,” he said.

All three of the wineries are small operations that produce their wines at facilities owned by others.

Wolf said he and the others were at the event, then asked Robert Coffman, an administrative law judge for the California Alcoholic Beverage Control Board “to reconsider the penalty based on the fact that no one intended to break the law, nor did we even know we were doing so. Nor did we endanger the public. This little-known law needs to be challenged,” he said.

“The intent (of the law) is to protect public welfare. What danger do we offer to public welfare?”

He also told the judge he feels the law involves some aspects of restraint of trade by prohibiting small wineries from pouring at consumer events.

ABC attorney Matthew Botting countered by saying, “The three here call themselves wineries, but they are not wineries. They want all the privileges (that go) with wineries.”

“We do not want all the privileges. All we want to do is pour wine and donate it,” said Wolf.

Wolf referred to a section of the ABC regulations indicating a warning letter can be sent when a violation is cited, and wondered why this did not apply in the case of the three vintners.

ABC’s Scott Warnock said deciding whether to warn or cite a winery depends on the severity of the violation, and penalties for violations are set forth in the  state regulations. He said the penalty for pouring illegally would be a 15-day suspension of the license, but the licensee could also opt to pay a fine based on sales of the previous year.

Claudia Sansone of StoneFly Vineyard acknowledged she pours wine at events “to get as many people as possible to know our wines. Wine tastings have always been a given. It never came up that we could not donate (wine). No one ever told us of this law.”

“No one is challenging that a wine tasting occurred or that these (three) participated. What we have heard is that they want to challenge the law,” said Botting. “It’s the licensee’s obligation to know what the law is. The obligations (to read the law) are easy to find — it’s not the ABC’s obligation to find it, it’s the licensee’s obligation.”

Botting was asked after the hearing if ABC would support legislation to change the laws. “If a legislator proposes legislation that affects the ABC, we work with them to assure it’s worded properly and we work with all people involved in the legislation,” he said.

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