Fear And Loathing In ToKalon Vineyard

When I think of “terroir” in Napa, the vineyard that most comes to mind is ToKalon, in Oakville. It is clearly one of the best vineyards and certainly the biggest name. No one doubts its quality. A bottle of wine with the name “ToKalon” on it carries consistently higher prices than any other large vineyard in the valley.

It is the premium economics of that vineyard that has now embroiling several parties in lawsuits and acrimony. These lawsuits are challenging not just the boundaries of that vineyard, but also setting the stage for legal challenges to the whole concept of “terroir” and “branding” that could change American wine forever, in my opinion.

Andy Beckstoffer and Mondavi Corp (now owned by Constellation Brands) had a legal battle in 2002 over the name use of ToKalon. After a lot of back and forth they settled upon each of them using the name, even though Mondavi owned the trademark. But there was another part of their agreement announcement, now forgotten…

“As part of the settlement, Mondavi will join Andy Beckstoffer in his efforts to establish a Registry of Historic Napa Valley Vineyards that maps out and distinguishes the local vineyards originated by various Napa Valley pioneers. The registry, according to Beckstoffer, will pay homage to Napa’s agricultural history and make certain that disputes like this won’t happen in the future.”

As far as I can tell, they never followed through. And this has set the stage for an end-game dispute just getting underway involving several parties with wide-ranging implications.

Gil Nickel, the founder of Far Niente Winery, the gorgeous winery/cave/tasting room on the Stelling alluvial fan in south-Oakville, is as responsible for the turnaround in super-high end wine as anyone in Napa. He restored the old winery, built the first new Napa caves in generations, and was a great friend to the valley. Far Niente was, in my opinion, the first modern winery that set the stage for ultra-high end estate wines that are commonplace now; estate fruit, beautiful facility, history, good people, high prices.

When he died in 2003, the winery ownership proceeds were distributed to the Far Niente employees and his family. Jeremy Nickel received a portion of the epic Stelling Vineyard in Oakville. Anyone who has ever driven to Harlan Estate has driven right by it, as it is surrounded on three sides by Harlan vineyards.

Jeremy named his new property “The Vineyard House” and started his own brand in 2005 on its 43 acres, 17 of which he deems to be “ToKalon.” Earlier this year, Nickel began a lawsuit against Constellation Brands over the use of the trademark “ToKalon.” In the lawsuit documents (which are available publicly) he claims….

Jeremy has maps showing his property was once labeled as ToKalon, as it was owned by Crabb. Yet in the National Registry nomination, which he opposes, it is pointed out his property was never planted and thus should not be included in the boundary:

“Aerial photography from 1942, 1948, and 1958 and a 1950 Stelling Vineyard map show no vines planted on this parcel. The first vines on this parcel were planted by Doug Stelling and his business partners circa 1980.”

Also, ToKalon is an entirely different soil from Stelling, from a different river and a different alluvial fan. They are not contiguous. ToKalon is flat. Nickel’s part of Stelling is on an upward slope. Stelling is nothing to sneeze at, btw. Parts of it are world class. If it were me, I would be trying to promote the Stelling name rather than add any parts of Stelling to ToKalon. Stelling is a great vineyard long-overdue for increased promotion. In the end though, my view as a spectator is not a legal argument.

For Jeremy to win, he will need to convince various government agencies that ToKalon (TK) should not be a “trademark” at all, but a historic location once under a former owner, which includes his property. And that all parts of that historic location, whether unified or broken into pieces, whether under original ownership or not, whether under vine or not, have the right to carry the name ToKalon.

Constellation’s legal view is that TK has never been a location at all, but has always been a brand name and nothing more, as their complaint below indicates…

Jeremy is against the National Register nomination Graeme MacDonald is working on to identify the boundaries of historic ToKalon because he believes a portion of his own property should have been included in the historic boundary.

Then again, some of what is currently Constellation’s TK was also not part of the original boundary. They are also opposing the National Register nomination, even though when they settled with Andy Beckstoffer, Mondavi Corp had promised to do this very thing.

Jeremy has been busy with the trademark office regarding ToKalon, as well. Below is a list of his proposed trademarks. Not only are there many proposed trademarks using the TK moniker but other vital terms such as “First Growth” and “Grand Cru” in association with it. Constellation is fighting this, of course.

Nickel has even started a ToKalon Farms designation. In Florida. Calling it a “Napa Food & Wine Experience”, he is bringing the Napa lifestyle to Florida, via The Vineyard House brand. ToKalon keeps getting bigger and bigger. Below is his video.

https://vimeo.com/336993542

I see longer-range issues to all of this. If Nickel gets the Constellation trademark overturned, I can see a similar outcome eventually to what happened with the Stags Leap District, and more than anything, this is what worries me personally.

Originally, SLD was meant to be a small portion of the current AVA boundary, but many other vineyards claimed in court they were also SLD based on general geography and soils, so by the time the dust settled, the courts just allowed anyone who petitioned to use the name Stags Leap, regardless of terroir or wine quality from the areas in question. Courts do not understand concepts like “terroir.” So if Nickel wins, then think of the other properties between Constellation’s TK and Jeremy’s portion that might contemplate the same argument? This might have no end.

Caught in the middle is Graeme and his family. MacDonald does not use the TK name on its label and as far as I know does not intend to, but he has soils that are unequivocally original ToKalon going back since the 19th century. No one doubts that. But that does not mean he would be allowed to say that, should Constellation decide to go to the mattresses.

Mondavi (now Constellation), who since 1966 has used the majority of the grapes from the family vineyard in its Reserve and ToKalon Cabernet wines, has not sued Graeme, but is opposing the boundary proposal with The State Preservation Office, requiring Graeme to expend a lot of time and energy on legal petitions. I have no idea how that, or this whole argument, will end.

Yet if Constellation wins I also see issues, as a name associated with a place and certain quality will now be their sole domain to do with what they please.

Where will this go?

Right now I can’t go a day without seeing a new commercial from Constellation. Using an actor who looks like Robert Mondavi, it shows him in the TK cellar and in the TK fermentation room, happily fermenting away. But the commercial is for Woodbridge, their million-case everyday brand, mostly from The Central Coast. No ToKalon fruit has ever gone into Woodbridge, as far as I know. Robert Mondavi, who spent most of his life supporting and promoting Napa, is now mostly an image being used to sell a $5-10 brand made from outside Napa. See for yourself.

This has all happened before. In the 1960s Heublein bought Inglenook. By the 1970s Inglenook ceased to be a “place” in Rutherford. It became a giant brand, mostly of lower-priced wines. It took Francis Ford Coppola decades to turn that image of the old Inglenook estate around and even now it is an uphill struggle.

Constellation owns the old Heublein, btw.

And what does Constellation say in their complaint about how they see ToKalon? And what might become of it if they win?

I for one do not look forward to the possibility of seeing ToKalon “Central Coast Pinot Noir,” $5.49 at Target, or ToKalon “Languedoc” Red Wine, $9.99 at Costco, in my future. They claim they have the right to do this, quite explicitly, although they also say in the very next sentence they have “no plans to produce ToKalon wines anywhere other than their Oakville facility.” But that wording has two big loopholes. First, “no plans” means no “current” plans. It makes no promises about the future. Second, they could easily import the grapes from somewhere else and make them in Oakville. So theoretically, they could make a ToKalon “ToKalon Vineyard” Red Wine, Lodi, if they wanted.

Would they actually do this? If it were Robert Mondavi answering the question, I think the answer would certainly be “No.” But Constellation is a large public company with $3 billion in wine sales that reports quarterly earnings and sales. If TKWC starts off as a high-end brand and is successful, the temptation to “grow the brand” may become irresistible. After all, look at Inglenook. Or Woodbridge.

I worry if this sets precedent, we may see many more names we associate with Napa (and even non-Napa) terroirs become brand names, instead of places, with lawyers suing anyone who dares discuss terroir (outside their legally approved and protected) definition. What will be left of The Napa Valley when it ceases to be a place and instead becomes a brand, devoid of any link to soil or geography? I worry we may someday find out.

thanks for the awesome info and the effort it took to post that roy

Thanks for that lengthy and well put-together post. I think this is the kind of thing that turns people off of Napa. It just seems money-begets-money and it’s all about pumping up the marketing.
Funny you mention Inglenook, as I always thought of them as a marketing tool of lower-priced (and not very good) wines, never realizing they had a great heritage that was squandered until later.

Informative post, Roy, but is it really so important to those of us here? None of use are buying (or would buy) $5.49 ToKalon Central Coast Pinot. I don’t buy anything with a “ToKalon” name, and frankly, at this point I would hope that smart growers and marketers would actually steer clear of that name just because of the confusion brought on by the corporate battles you outline. Two of the prime producers at the center of ToKalon don’t even use the name (Detert and MacDonald).

I don’t like the idea of mega-companies trademarking meaningful local names for their sleazy marketing purposes, but it happens (witness Delaware North claiming the Ahwahnee name, along with others - thankfully rescinded recently). I hope it doesn’t happen in this case, but in any event, it won’t change the actual source of what’s in a bottle. Educated buyers will pay more attention to what producers tell us about the land, the vines, and the wine, than to the name on a label.

When Napa allowed “The Prisoner” to establish a large, prominent presence right on Highway 29, it gave up any claim to market itself as a region of unique and highest quality wines.

Incredibly insightful, if frustrating.

Alan, I think it is important for several reasons…

1. It could lead to Constellation taking action against anyone (other than itself) from using the ToKalon name, even in marketing conversation, maybe even in print, even if the land was known as ToKalon long before the company ever existed.

2. They could do to the name what Heubelin did to Inglenook. Take the greatest name in Napa and dilute it to the point where no one remembers it was ever great.

3. Could lead to other companies doing the same with their vineyards, thus making terroir a brand instead of a place.

4. Could lead to many other vineyards claiming they are ToKalon. I can see two or more square miles of Oakville making a claim on this.

I think this does affect people here. How much Schrader ToKalon do people on this board have in their cellars? Millions worth? What happens to the value of those bottles if/when the name is associated with all sorts of things and places? And is “terroir” not an issue to people here?

I disagree that Napa “gave up any claim to market itself as a region of unique and highest quality wines” when they allowed The Prisoner to set up shop. First, how exactly could they stop them? Reject it because all the wines are not from Napa? Some of The Prisoner wines are from Napa and seven of them price over $40 and one over $100. Not sure that argument legally or logically holds water. There is a LOT of Bordeaux for sale out there between $10-19, less than the price of The Prisoner.

Interesting. Just a few hours ago I received a letter from Alex and Graeme detailing their discussion with Constellation on this topic. Apparently they were offered the opportunity to use the name ToKalon if they agreed that it was not a place, and they rejected it. Their take was “Our integrity is not for sale.”

Well…along these lines…I’ve been telling Carole that she & Steve should TM Tribidrag. At one time, HopKiln had the TM to Primitivo.
Tom

I understand, and am sympathetic. I obviously hope that Constellation doesn’t prevail in this. But I also wonder if the ToKalon name has already been diluted by so much overuse. The few small producers who could or would use it should have enough of a story to tell that a name in and of itself should hopefully not make that much difference. If it were me, I would see the writing on the wall regardless of the outcome with Constellation, start moving away from the name, and focus on the history of the land and its vineyards, the people who established those vineyards, the vines, and the wine itself. I don’t buy Detert because it’s “ToKalon”, I’ve bought because it’s Detert, and the family history, the vines, the wines, mean something to me.

This article, linked in the recent Detert thread, is useful to have here:

It’s all a bit confusing, frankly.

And, once again, I hope that Constellation doesn’t prevail, it would be a travesty to use such a historical name for their newly intended purpose, regardless if it is attached to a particular plot of land, or was always a broader label.

And I still think having “The Prisoner” prominently greeting you along 29 is an embarrassment

Constellation now owns The Prisoner too. And they own Franciscan, who occupied it previously.

Kind of my point.

I don’t see how they can ever claim that To Kalon was just a brand and had nothing to do with place. Mondavi and Beckstoffer did not argue because of a brand. It’s a place, even if the current owner of the name wants to debase it. A court does not need to understand terroir to understand that.

However, determining the exact boundaries is another issue. Is it all the land that Crabb owned or just what was originally planted or what Mondavi and others planted or anything that could be planted within the old boundaries?

It won’t matter to the price of any Schrader in anyone’s cellar if the name becomes akin to Woodbridge. People who buy that wine won’t really care and if they do, they’re pretty dumb.

As for Mondavi - he was indeed instrumental in promoting not only Napa, but wine itself in the US and for a small guy is nonetheless a towering figure. But Woodbridge is what made him a lot of money, and he wasn’t so proud that he wouldn’t produce a wine for the masses.

The dispute doesn’t help anyone though. The name only matters to the people who care. For the mass market, Constellation could start a brand called Constellation and within a few years that would probably be worth as much as To Kalon. “The Prisoner” didn’t have any antecedent and it seems to be doing OK. Seems dumb to devalue something that matters to the wine people who care. Those people won’t be tempted by the name plastered on something else, whereas the people who don’t know it will have to be instructed. Just seems like a dumb waste of a corporate asset.

I’d buy the $5.49 ToKalon wine!!!

This doesn’t seem to be a problem in the real world, remember California used to be called “Mexico” and Israel, “Palestine”. Seems once an entity takes over a place they can do whatever they want with it without repercussion.

It’s gotta be great, right? I mean, it says To Kalon on it!

I’ve posted him before, but…

This is our dog, To Kalon, guarding some fine Roadhouse wine from the pesky coyote. Can he keep the name?

That is an awfully cute dog!

Why do you hate the free market?

Awesome post tho, Roy - fantastic read and very much appreciate you taking the time!

Really informative and thoughtful post Roy, I appreciate it!