A couple of prominent California wineries have been in the news recently regarding ownership disputes between "winemaker owners" and their partners. The first dispute relates to Pax Wine Cellars in Sonoma where the namesake winemaker, Pax Mahle, has been fired and is locked in a dispute with the majority owner . The second dispute relates to Napa flagship winery, Joseph Phelps, where a former employee (the winemaker) and the estate of the late Tom Shelton who was the CEO (and widely known throughout the industry) are also fighting over the value of minority ownership shares with the majority owners .
While these disputes are no doubt unique and while some disagreements are inevitable, these types of lawsuits do show the value of ownership and succession planning. Wineries are not unique to these issues - many, many businesses (particularly family owned ones) do not pay sufficient attention to succession planning until either a dispute arises or one of the key people leaves or passes away. Does your winery have a succession plan for key personnel? If not, you should contact your legal and financial advisors for assistance in implementing one.