A major California wine dealer that abruptly closed its store amid accusations of fraud by customers has filed for bankruptcy, according to court filings.
Premier Cru, a wine retailer and importer based in Berkeley, California, filed for Chapter 7 liquidation Friday, citing $70 million in liabilities and only $7 million in assets. The case is believed to be the biggest wine-seller bankruptcy in recent history, and could rattle confidence in the fine wine world.
"This is by far the biggest that I've seen," said Marc Lazar, president of Domaine, a leading wine advisor and wine-storage company. "I think people are going to feel burned after this and feel less willing to open up their pocketbooks for wine."
The case is likely to include some of the richest wine collectors in the world. While the court documents are abbreviated for now, there are more than 9,000 collectors and companies listed as creditors — including billionaire collectors William Koch and Jeff Greene.
Experts say some billionaire collectors are out more than a half million dollars from wine they purchased but never received from Premier Cru.
"This company was the bluest of the blue chip." Lazar said. "It will be billionaires on the list, but also I'm afraid a lot of middle-class people who bought wine."
Premier Cru sold wine, wine futures and pre-arrival wine — meaning wine that was bottled but had not yet made it to U.S. shelves. In the wine futures market, customers buy wine that is aging but has not yet been bottled in hopes of getting it cheaper than the post-bottle price.
As reported by CNBC, at least 10 customers filed suit against Permier Cru late last year after the company failed to deliver wine it sold. Calls to Premier Cru's owners and attorney were not immediately returned.