Wednesday, September 15, 2010

Should a convicted felon get in the Vintners Hall of Fame?

Before voting ends for the Vintners Hall of Fame on Friday, I'd like to put on my hat as Chairman of the Electoral College to address an issue some have asked about.

Fred Franzia is on this year's ballot because, in my opinion, he has done more this decade to put wine on the dinner table of low-income people than anyone else. Plenty of teachers and social workers and NGO employees who might have had Pabst Blue Ribbon with dinner, or maybe water, instead enjoyed a civilized glass or two of Two Buck Chuck.

By selling Charles Shaw wines at $2 a bottle ($3 outside California), Franzia has taken over his uncle Ernest Gallo's mantle as the guy who reaches out to non-wine drinkers to convert them. And Two Buck Chuck is a gateway drug -- today's 23-year-old Charles Shaw drinker might be the next decade's single-vineyard Mourvedre enthusiast.

But Franzia has an obvious black mark on his candidacy. In 1994 he pled guilty to federal charges of conspiracy to defraud. Prosecutors said Franzia and his Bronco Wine Co. labeled cheap grapes worth $100 to $200 per ton as Cabernet Sauvignon and Zinfandel, sprinkling a few Zin leaves on top to make the loads look more authentic. Bronco pleaded no contest to misrepresenting 5,000 tons of grapes and 1 million gallons of wine. Bronco paid a $2.5 million fine; Franzia personally paid a $500,000 fine. He didn't do any jail time, in part because prosecutors believed Bronco might go out of business without him, costing innocent employees their jobs.

Franzia also conducted a 6-year legal battle with Napa Valley Vintners and the state of California over the misleading use of place names. He bought three defunct brand names -- Napa Creek, Napa Ridge and Rutherford Vintners -- and bottled wines from elsewhere in the state using those names. He finally lost, and I'm glad he lost. He was attempting to make Central Valley wines more appealing to consumers by confusing them with the Napa and Rutherford names, and that's both dishonest and not good for wine.

So how should we weigh his positives and negatives? Franzia is the biggest populist in the wine industry. He frequently complains that the wine establishment charges too much for its products, and with his own pricing he backs up this belief. He has sold more than 400 million bottles of Charles Shaw. If it sold for $2.50 instead of $2, and he got an extra 10 cents on each bottle, that would be $40 million more for Bronco. But he has held the line on the price -- instead leaving an extra $200 million in the pockets of his customers.

And yet, his federal conviction strikes at the heart of what wine lovers believe. We can't tell from looking at a bottle whether the contents are really Zinfandel; in many cases we can't really tell after tasting it, as many wine experts have discovered in blind tastings. We have to trust the winery and trust the label. I'm glad the feds caught him and punished him, because that helps maintain that trust.

But still -- was that a knockout offense for the Vintners Hall of Fame? He's on this year's ballot, so obviously the Nominating Committee doesn't think so.

I want to know what you think. Post it in the comments.


King Krak, I Drink the Wine said...

Only if Pete Rose gets in the Baseball HoF first.

steve stevens said...

To carry on with the baseball analogy, why not? But it depends, I suppose, on whether it's decided that his impact on the wine industry is as big as you describe. To outweigh such large-scale fraud, I'd think that voters would have to decide that his positive impact has been enormous.

Christian Miller said...

Here is something to consider regarding the popularizing effect of 2 Buck Chuck. Several research studies, using different methodologies, concluded that the vast majority of 2 Buck Chuck volume was derived from: (a) current wine drinkers trading down from more expensive wines; or (b) current wine drinkers making additional purchases (e.g. "hey, we can afford this with Monday night leftovers").

W. Blake Gray said...

King: I favor inducting Pete Rose posthumously for two reasons: 1) Rose is currently banned from baseball, so how can he get its highest honor? 2) Rose would exploit an induction, just as he has pugnaciously exploited his exclusion for years now.

Is this thinking is analogous to Franzia? Point 1 doesn't apply; I'm not sure point 2 applies either. But anyway, those are just my Pete Rose opinions.

Christian: I would argue that if 10% of Two Buck Chuck drinkers are making a wine purchase that they wouldn't otherwise make, that's significant. Do you know if that's the case?

Anonymous said...

Question is, what does the Vitners Hall of Fame supposed to promote? Are the inductees people who have revolutionized the area of winemaking and viticulture? Or is it a bunch of fatcats who made a bundle of money making wine and the hall is a self-congratulatory pat on the back?
I worked for the guy and I am not really sure if his winemaking method or viticulture philosophy is groundbreaking or has changed the face of wine. He has certainly changed peoples attitudes about what is good wine and maybe that is enough for hall. But like anything, he got to where he is because of luck and bare-bottom marketing. Without Trader Joe's though, would he be nominated? Would Fred Franzia be a house-hold name?

W. Blake Gray said...

Anon: The Vintners Hall of Fame recognizes people for their contributions to the California wine industry in any area. It is not limited to winemaking and viticulture. Please take a look at the members of the Hall:

John M. Kelly said...

Well... I see some folks in the HoF who may not have been convicted of anything but it's pretty common knowledge (or mythology) that back in the day some folks got knecapped if they didn't retail their wines front and center.

My issue with FF is that he has done a lot for FF but for the California wine industry as a whole? "No wine should sell for more than $10" may be a brilliant marketing tagline, and I would argue that it is absolutely 100% true - for Franzia wines, at least.

For the rest of us? Not sure his efforts have done so much.

Christian Miller said...

"Christian: I would argue that if 10% of Two Buck Chuck drinkers are making a wine purchase that they wouldn't otherwise make, that's significant. Do you know if that's the case?"

I'd have to dig though some old files to give you a numerical answer. To generalize, a significant portion of the 2BC purchases was incremental new business. This was a good thing at the time because it helped drain the wine glut in the Central Valley (whether the pricing is sustainable for all but the most efficient growers is another story).

However, the disappointing part of the research was that it showed 2BC buyers were generally core wine buyers adding on volume, not "converts" from Bud or iced tea, as the industry had hoped.

Anonymous said...

He committed fraud, stained the industry's reputation, and he should be in the hall of fame? No way.

Peter Minde

Anonymous said...

Well, yes Mr. Franzia should go into the VHF. If, and this is a big ball of wax, ALL of his good and not so good wine points are highlighted. If you are going to "gloss over" the not so flatering things, then forget about it.

Anonymous said...

Franzia has attempted to cheat the consumer at every turn and has rightly been convicted of a felony and lost in every opionion all the way to the US Supreme Court in his attempts at misleading wine labeling. How can anyone think he should be honored for this? Has he shown innovation or leadership, or has he set out to make a lot of money for himself while disparaging his peers? There are lots of great value wines that are produced by winemakers of honor with values--inducting Fred Franzia is an insult to the industry

Anonymous said...

You would be allowing him to commit another crime against truth in labeling if he were to be inducted into the vintner hall of fame--perhaps if there were a hall of scoundrels or a hall of shame--either would be a more appropriate place for Mr Franzia--

Sam @brokewino said...

If you can get over the fact that Franzia knowingly and willingly intended to deceive consumers about the product they were purchasing, then he certainly gets in.

But like John said above, what has he done for the industry as a whole? Mondavi comes to mind as a guy who sold a shit ton of his own wine, maybe not as cheaply, but his legacy is omnipresent in American wine and beyond.

Anonymous said...

First off, what does baseball have to do with wine?

Franzia should be nominated for what he has accomplished, not the mistakes he made. Alternately, examine all candidates and list their mistakes.

Is the Vinters Hall of Fame about mistakes or accomplishments and advancements.

I not like any wine maker or marketer to mislabel any wine, not one bit. It does happen though and not just Franzia.

Anonymous said...

I think that many of these comments have slightly missed the point, Fred's mislabeling of wasn't to deceive the customer, he really used it to take advantage of another company and make a good business deal. When it comes down to you it you have to respect the guy's business sense (morals ... maybe a little iffy but let's be honest I think quite a few of you need to get off your high horse and admit that sometimes we are all a bit iffy in our morals, that's just the real world; the last time anything was fair for everyone was kindergarten. Boys and girls, it's time to grow up). It is this business sense that inspired Fred to take a look at the industry in a time when people were dropping grapes on the ground, due to the glut, and recognize it may not be much but it's more than nothing to buy the grapes and produce the wine at the daring price of $2 a bottle. And, whether it is increasing the purchases made of existing wine drinkers or creating new wine converts, can you really argue that either of those isn't a benefit to the industry. Finally, as a recent college graduate (go ahead and throw my credibility right out the window due to my age, I'm used to that by now) I can say I know from personal experience of a number of keystone light drinking millenials who began an exploration of wine due to Two Buck Chuck and from there have learned to try new wines and incorporate it into their lifestyle.

Anonymous said...

W. blake thank you for the link for HoF. The Gallos are there, and there is no questioning their contribution. But reading about their empire and the crooked deals they got through congress to give them a market advantage, Fred doesn't look so bad. If anything, the Gallos are just as guilty as Fred except Fred got caught. I hope the committee votes him in.

charmion said...

I think that low income wine drinkers could and would have been better served by many other more honest people in our industry. Imagine how much rose Americans would drink if Gallo had not poisoned the well by selling huge amounts of pink swill to alcoholics and making most Americans think that rose is just awful. Just because Two Buck is successful, it does not mean that some other brands would have done a better job of putting better quality wines into the market at sub-$5 price. Near thuggery is not anything to be proud of.

Santo said...

Let him in. He has done a lot to get the non-wine drinkers into wine. If you really think about it, how many of the presidents have done worse? Are the people in congress any better that what Franzia did? The only difference is that they have not been caught.

Jeff said...

There would seem to be better options out their for enshrinement than someone who produces a beverage that is being passed off as 'wine'.

There is an origin of the term "Franken-wine"

The 2BC as a "convert" wine is about as accurate as Old English being the "convert" beer. These are nothing more than cheap "converts" to getting drunk.

I would however vote for Mr. Franzia for enshrinement in the Marketing Hall of Fame (if one exists) because in this field he excels. I have mountains of respect for his branding successes, but I despise the products themselves.

rsaikowski said...

A Hall of Fame regardless of whether it deals with wines, baseball, football, music, etc. should be the acme of the industry. Allowing a convicted felon into a Hall of Fame should be a crime unto itself. The people voting in this institution should hopefully hold lofty ldeals for the people that are bestowed this honor. However, since this is limited to only California, then California can do what it wants. If they want to honor Federal Felons, then it is their right to degrade their Hall of Fame.

to said...

I think "THE HALL OF SHAME" might be a better spot for him.

George P said...

I can't believe for a minute that Fred would give a Rats-A#@ as to weather he makes the HOF or not.

As for the honor itself, it seems to me it should be left to those that have a view of wine as a substance that enrich's mans existence. Stewards of the art and craft of viticulture and enology.

I gotta think all Fred is concerned with is $$$$$$$$$ and more $$$$$$. Quality, flavor, heritage, "Terroir" ; the art that wine is...doesn't appear to mean anything to a guy that works to confuse the consumer about what's in the bottle and where it came from so he could make more $$$$$$.

As far as $2 Chuck? I met the real Mr. Shaw and spent a week with him in the late 80"s when
Cru-Beaujolaise was not a well known thing in this country. The real Charles Shaw did all he could to bring awareness to this great wine region/grape/wine style.

Ask Charles Shaw what he thinks of how Bronco abused his name and ruined his legacy in wine.

Not now for the HOF. If in the real Charles Shaw.

Paul Simpson said...

If the Hall of Fame does not bar a convicted felon from being nominated so be it. If he is inducted, I will really like to know the reasoning as this conviction did nothing vinously positive.