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Kunde, VWE sue insurance carriers over failure to pay for 2017 smoke taint fire damage.

Kunde Enterprises, Inc. and Vintage Wine Estates, Inc. (VWE) have filed a joint lawsuit that seeks to compel nine insurance companies to reimburse them for approximately $20 million in smoke taint damages resulting from the 2017 October 2017 wildfires in Northern California.

 

Kunde Enterprises is the owner of Kunde Family Winery in Kenwood. VWE, headquartered in Santa Rosa, owns a collection of premium wineries and brands. The two wineries share the same group of collaborative insurers who claim — among other things — that they do not insure grapes on the vine.

 

Kunde lost more than $7 million and VWE more than $12 million, according to the complaint,

 

Kunde and VWE’s complaint, contends  that the “all risk” coverage policies do not specifically exempt grapes on the vine and further, that the smoke damage occurred when smoke from the wildfires infiltrated the winemaking process, which contaminated the wines.

 

 

According to the complaint:

‘For companies like Plaintiffs that owned wineries and conducted winemaking operations in the affected area, the Wildfires resulted in smoke exposure to the wine products (in various stages of the winemaking process) during and in the immediate aftermath of the fires. The smoke exposure damaged the finished wine with a perceptible “smoke taint.

‘Compounds from smoke generated by the Wildfires permeated the wine products in process, such that the finished wine conveyed strong aromas and undesirable tastes. This destroyed the marketability of the wine, beyond a mere salvage value.’

Total of 7 insurance carriers sued

The Latham & Watkins San Diego office filed the lawsuit on behalf of Kunde and VWE against:

 

  • National Surety Corporation,
  • Certain Underwriters At Lloyd’s,
  • London; Rsa Insurance Group,
  • Liberty Specialty Markets,
  • Insurance Group; Navigators,
  • Underwriting Agency Limited,
  • Brit Global Specialty,
  • Travelers Marine Cargo.

The full complaint document is at this link