Wineries Affected by the 2017 Wildfires

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Our law firm currently represents wineries against PG&E for losses sustained due to wildfires. We have tremendous experience navigating tort claims (like business losses from wildfires) through bankruptcies. The PG&E bankruptcy is moving quickly and if you don’t act by October 21, 2019, right after harvest, you will lose any chance for compensation.

While the media has exaggerated the nature of wine damage caused by the 2017 wildfires, we know that when the fires began on October 8 and October 9, 2017, most of the grapes in Napa and Sonoma had already been picked. For the most part, the only grapes left on the vine were Cabernet grapes. Even as to Cabernet varietals, the majority of Cabernet grapes were nowhere near the fire zones and unaffected by smoke taint. So, who was impacted?

As the 2017 Cabernet vintage begins to hit the market in the coming months and year, we understand wine businesses like yours may realize loss. Maybe your grapes initially tested normal but now, after fermentation, the wine is testing or tasting smoked out. Maybe there’s no smoke damage whatsoever but you are having trouble selling your wine due to incorrect market perception that all 2017 Cabernet grapes are damaged. Perhaps you are concerned that wines that test normal now and are received well by the market eventually “smoke out” after bottling. If any of the above apply to your winery, you may be entitled to compensation from PG&E.

You may be entitled to other losses as well. Maybe your wine membership is down since 2017, or maybe your tasting room was closed during the fires. All of these are potentially compensable business losses.

Please note, we understand that many wine brands are concerned about adverse publicity and/or reputational harm caused by actively litigating claims involving potential smoke damage to wines. We can help you understand that the risk is low but the potential benefits are enormous. First, your case will not be actively litigated. It will not be filed. As a result of the bankruptcy, all civil lawsuits are stayed. Instead, you have a “claim” that will be filed in the bankruptcy. However, your claim will be one of what is expected to be more than 50,000 claims made in the PG&E bankruptcy. The sheer volume alone makes it unlikely that any particular claim will be isolated and focused on by the press or media. Second, to the extent there is fear that by making a claim for smoke damage you will help create a negative market perception, the damage is already done. The media and wine insiders have been discussing this issue since 2017. The risk that a winery will somehow bring unwanted scrutiny on industry by filing a claim in the bankruptcy is negligible.

While businesses like yours would typically have the luxury of a wait-and-see-approach both to litigation or to see what happens with the wine, the bankruptcy of PG&E changes everything. Wineries who have not filed a proof of claim by October 21, 2019, will be left without any compensation regardless of whether or not the loss was just realized, or possibly even if loss will not be realized until the future. Call us today!

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