Trust is the glue that holds the trade together

David Williams watches the Sherry-Lehmann saga play out in all its lurid detail. It makes him reflect on just how fragile the wine trade is – and how reliant we all are on everyone in the supply chain keeping their promises

Whatever else you might say about tabloid journalists, they do have a way of ferreting out the telling details that make a story come to full, seedy life in ways that other, more sober news sources just can’t manage.

That, at least, was what I was thinking as I read the New York Post’s reporting on one of the biggest stories in US wine retail at the moment: the fall of Manhattan wine merchant to the rich and famous, SherryLehmann.

For those of you who don’t follow the ins and outs of the US wine retail scene, Sherry-Lehmann – an upmarket wine-retailing institution that is roughly equivalent in size, status and influence to Berry Bros & Rudd or Justerini & Brooks on this side of the pond – has been in serious trouble for a while now, fending off lawsuits from customers over unfulfilled wine orders running into hundreds of thousands of dollars; struggling to pay its bills to its landlords, its suppliers, and, most ominously, the US tax authorities; and the subject of an FBI inquiry which saw its Park Avenue store raided by agents in late July.

In its take on the story, the Post inevitably has a lot of fun with the luxurious, high-rolling lifestyle of Shyda Gilmer and Kris Green, who acquired the business in 2006 from the highly respected founding Aaron family who had been running it since it first opened in 1934.

Gilmer and Green “have enjoyed lavish travel perks, regularly taking helicopters and private jets to the Hamptons and Saratoga Springs to schmooze with wealthy clients and vendors at racing and auction events,” the Post story says, making full use of the clause that states that, in tabloid land, perks are always lavish.

“The pair are said to be regulars at The Masters, Wimbledon and the Super Bowl,” the story goes on to say “and – to the consternation of staff – in recent weeks have been in Paris, just as the crucial holiday selling season is ramping up, according to sources.”

Rather more pertinent to the allegations confronting Gilmer and Green than these gobbets of classic tabloid insinuation, however, was the Post’s accusation, via several current and former employees at the firm, that the duo had a habit of making off with the store’s best wines without paying for them.

Magnums of top Burgundy, Bordeaux and Champagne were allegedly taken as a matter of course to NYC’s smarter restaurants (one employee told the Post that celebrity hangout sushi restaurant, Nobu 57, was Gilmer’s “office from 11am to 11pm”), while “Sherry-Lehmann staffers were also supposedly instructed to send cases of fancy Champagne, Burgundy and rosé to Gilmer’s summer rental pad in the Hamptons at zero cost to him – and the tab rose to staggering heights”.

This is where the gossipy fun stops and the story begins to get rather more serious, and troubling, with the accusation going to the heart of the FBI investigation and the various lawsuits Sherry-Lehmann is fighting. The allegation is that Gilmer and Green weren’t simply drinking their own profits, and living it up on the company account; they are also alleged to be selling rare and expensive wines stored on behalf of customers in their warehouse, to other customers.

It’s a depressingly familiar story in the United States, with John Fox, owner of celebrated fine wine retailer Premier Cru in Berkeley, California, found guilty of fraud after selling wines that he didn’t in fact own to customers as recently as 2016. Fox, who in a satisfyingly sleazy twist was also being blackmailed to the tune of $10,000 a month by a prostitute, was sentenced to six and a half years in prison and ordered to pay $45m in compensation.

Both stories will bring up uncomfortable memories in the UK, too, of Mayfair Cellars, the fine wine merchant that went under in similar circumstances in 2005, after customers’ stock held in storage by the firm worth more than £1.2m was resold without consent by a rogue staff member.

Taking customers’ money and then not fulfilling orders was also very much at the core of the recent issues surrounding winebuyers.com, which went into liquidation in 2021 owing its 200-plus creditors more than £1.5m.

As ever for those not directly involved, there is a frisson of excitement in the telling of these true-crime tales. But, without in any way wishing to underplay their seriousness, what makes the stories of SherryLehmann, Premier Cru, Mayfair Cellars and winebuyers.com all the more remarkable to me is that they don’t happen more often, given how so much of wine merchanting is based on trust.

That’s especially true when it comes to the trading of fine wines where storage is involved, notably en primeur, where huge sums of money are handed over in good faith for a product that won’t even be available for a year or two.

But the delicate and complex network of trust has threads running from grape (is the grower really harvesting that variety and that yield?) to bottle (is that wine really what it says it is?) to store room (is that case of 2010 Cheval Blanc really where they say it is?).

To join the world of buying and selling wine is to make a tacit commitment to preserve that fragile network. If the wine merchant had a Hippocratic oath, it would no doubt include something about abstaining from deceiving any customer. That’s why, when we’ve had our fill of the shocking and titillating details, what most of us feel when we hear about wine’s rogue traders is something like disgust.