New York wine crisis: FBI raid top shop, $1,000 bottles found stashed in Times Square TGI Fridays

12/15/23
Asher Rubinstein in the New York Post on the latest wine crisis in New York including FBI raids, $1,000 bottles stashed in Times Square TGI Fridays

Featuring Partner Asher Rubinstein, Gallet Dreyer & Berkey, LLP. Written by Michael Kaplan, New York Post.

Big Apple wine lovers are enduring a sour season.

It’s been a rough year for people who spend big bucks on rare bottles and entrust them to New York City’s ritzy wine merchants for storing and proper aging.

First, in February, the venerable Sherry-Lehmann wines was raided by the FBI and exposed for bad practices that are alleged to have included the mishandling of bottles.

Potentially among them: two cases of 1982 Petrus Bordeaux, valued at $90,000.

Then Chelsea Wine Storage, a facility entrusted to hold millions of dollars worth of rare vintages, took heat with accusations of mishandling collectible bottles, being slow on delivery and quick to confiscate bottles from customers who owed storage fees — even when the valuations of the wine far exceeded the sum owed. 

The twin calamities have sent shockwaves through the elite world of wine-collecting, a hobby which for most who practice it in the city requires high-quality storage — which may not come cheap.

As an oenophile put it to The Post, “They need to keep wine at the right temperature and humidity while keeping it away from light… And give you your wine when you want it.”

Attorney Asher Rubinstein told The Post: “Collectors are literally losing sleep over this.”

Among the worst of the claims: sources alleged that Chelsea Wine Storage, far from carefully tending to bottles which could become heirlooms, has thrown them under Times Square’s former TGI Fridays and has kept some in cardboard boxes.

They include bottles of 2011 Coche-Dury Meursault, a white Burgundy that sells for $1,200 per bottle, and a Domaine Faiveley Bâtard Montrachet worth $490 per bottle, according to inventories seen by The Post.

Since early November, a source told The Post, increasingly panicked customers requesting delivery of their vintages have found representatives of the wine company difficult to reach.

In one such situation, a storage customer with Chelsea Wine Storage was trying to retrieve a collection “of significant value,” Rubinstein told The Post.

“We worked with Chelsea to get the wine,” he said. “It took a constant stream of calls and emails over the course of around two months. [Rubinstein’s client] was proud to amass the collection and was rather stressed about not getting it back.”

Chelsea’s attorney did not return a request for comment.

While the owners of Chelsea have previously blamed it on staffing issues, Rubinstein, a wine collector himself (who does not have bottles with Chelsea) sees the problem going beyond someone being sore about waiting on a few prized bottles for the holidays.

“I think of this on the macro level,” the attorney said. “You are an investor and collect wine and amass thousands of cases.

“We’re talking about $500,000 collections, and you can’t get these guys on the phone. What if you had an equivalent amount of money at the bank and the bank stopped taking your calls? How would that be acceptable?”

The claims are not the first against Chelsea Wine & Storage, which quit Chelsea Market last year.

In 2018 it was sued by customer Michael Moriarty, who accused it of mishandling his collection of “around 1,200 bottles with a value of approximately $100,000 to $200,000.”

When Moriarty tried to get his goods, he was told that they were “disposed of due to non-payment of storage charges.”

According to the court documents, Moriarty owed some $7,000 in fees and offered to pay the money back. But, according to the complaint, “the offers were rebuffed.”

Moriarty alleged that the wine “was not, in fact, disposed of, but instead is on the shelves… for sale.”

Rubinstein, who represented Moriarty, told The Post, “Moriarty bought wine at an auction and the labels were inscribed with Moriarty’s son’s name in the early 2000s.

“He entrusted the wines to Chelsea and those bottles were found upstairs in Chelsea’s retail store. Somebody he knows saw them for sale. Chelsea just denied it.”

The case was settled in 2019. Chelsea’s attorney did not return a request for comment.

The demise of Sherry Lehmann has also spawned anger.

“I asked them to deliver my wine and it was rope-a-dope bulls–t,” a former customer who’s missing thousands of dollars in rare Bordeaux, fumed to The Post.

“I’m emotional about it because of the missing wine but also because I was ripped off financially.”

Sherry-Lehmann was founded by the bootlegger father of former owner Michael Aaron, and last headed up by Kris Green and Shyda Gilmer.

They are now being sued by at least one former customer. Gilmer and Green did not return calls for comment.

Even as he awaits a court date in May, the former customer said, “I’ve emotionally written it off. I don’t expect [the owners of Sherry-Lehmann] to show up in May for a civil hearing.

“It pisses me off that guys [have been accused of] stealing good wine, living good lives and drinking what does not belong to them.

“Sometimes I will be enjoying a glass of wine and thinking about my missing cases. I wish I had them and that that they were aging for the next 10 years.”

about the attorney

Asher Rubinstein

Partner

Asher Rubinstein's practice focuses on domestic and international asset protection, wealth preservation, estate planning, tax planning, tax controversy, offshore tax compliance, and related litigation. Mr. Rubinstein is a recognized expert on offshore entities, foreign banking, and IRS compliance issues. Mr. Rubinstein also represents and advises wine, spirits, food, and restaurant clients.

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