Federal Judge Rips Into The Vineyard House, Awards Constellation $2.3 Million in To Kalon Battle Legal Fees

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The long-running dispute between Constellation Brands (Robert Mondavi Winery) and The Vineyard House over To Kalon vineyard designation rights is finally over with the judge awarding Constellation $2.3 million of the $4 million it had requested.

 

U.S. District Court Judge for the Northern District of California Judge Yvonne Gonzalez Rogers wrote [emphasis added] in her July 28 order: (premium link)
 

"This Court cannot recall a single instance where it awarded attorneys’ fees under a standard requiring “exceptional” or “extraordinary” circumstances (as opposed to fees authorized by statute or contract to a prevailing party).

"In short, this case should never have been tried.

"Perhaps, it should never have been brought.

"Unlike Mr. Beckstoffer, TVH did not have a legitimate claim.

"However, even giving TVH the benefit of the doubt, certainly, after the Court issued a preliminary injunction, the action should have resolved. The fact that TVH ignored a walk-away offer is baffling.

"To the extent that TVH now interprets the Court’s Rule 52 Order to argue that its claim had any merit, the Court can only surmise that TVH has seized on a few phrases included to cushion the landing for the lawyers hired to pursue, unfortunately, a client’s bidding.

"Ultimately though, a line must exist across which litigants, and lawyers, should not cross without consequence.  This is the line defined by the concept of “exceptional.”

This is the line that TVH cavalierly traversed without any regard for the attendant costs or impact.   Mr. Nickel, whose actions are one and the same with TVH, showed himself to be one who cared not whether he was acting in a rash manner, who indiscriminately ignored the findings of experts when the findings did not suit him and the established parameters of the law in the context of pending litigation, while later downplaying the actions in his testimony.

Courts should be used in good faith and not as a relatively free means to test one’s self-centered, unfounded ideas.  An award of attorneys’ fees impresses upon those who use the courts primarily for self-indulgent purposes, and without regard for the law, that the cost will be greater than that expended on their own side of the ledger.

"Usually, resources or business judgment serve to counsel reasonableness," Rogers said. "Unfortunately, no such external force bridled the plaintiff here."

The full text of the Judge's order is available for Wine Executive News premium subscribers.

An article in Reuters also covered part of this decision.

Previous Wine Industry Insight coverage

• Vineyard House, Constellation To Kalon battle may be over soon.
• Dueling To Kalon lawsuits — Constellation & The Vineyard House — scheduled for trial in federal court
• To-Kalon lawsuit all about myth, Benjamins, and grapes at $38K/Ton
• Vineyard House Seeks Injunction To Stop Constellation Brands From Using “To Kalon” Labeled Wines

Further information, and links to full court documents, are available to premium Wine Executive News Subscribers.

More Court Filings (Premium)

• Parties' stipulation on trial dates and rules
• Judge's order approving Stipulation on trial dates and rules - with court modifications

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