No Wine Before Its Time
One hundred bottles of wine on the wall, one hundred bottles of wine, you take them down, pass them around, and...you've got one hell of a headache if you're Denver bankruptcy trustee David S. Cohen.
The 100 bottles in question once resided in the wine cellar of the Stanley Hotel in Estes Park. But when the owner of that mountain resort went bankrupt last year, the wine he left behind began a long, strange trickle through the judicial system. Today, trustee Cohen, a small squadron of attorneys and a federal judge are still trying to figure out what to do with the stuff--while they grapple with a strong case of sour grapes.
The wine first became an issue when the new owners of the hotel, which is still operating, decided they didn't want to buy the selection of mid-priced reds and whites that range in vintage from 1984 to 1993. "These are just a few odd lots that for some reason are no longer on the wine list," explains Cohen. "I don't really know why they decided they didn't want it. I decided it was wrong for the estate to just give it to them."
The liquor distributor who'd originally delivered the booze to the hotel didn't want it, either. So Cohen says he had an accountant throw the wine--actually 109 bottles in all--in his vehicle and cart it to the attorney's high-rise office in the Norwest Center. There it has remained ever since, under seal in a storeroom, awaiting consumption. Whoever does finally get to drink the stuff probably won't experience an epicurean epiphany, predicts Cohen. "Most of the bottles say 'table wine,'" he notes. Adds the attorney, "I have never opened a bottle."
But Cohen did open a can of worms in July, when he floated an unorthodox proposal: to hawk the vino, which he values at around $550, to his friends and business associates. The attorney describes the plan as a last-ditch effort to unload the wine. After the bottles arrived in his office, he says, he learned that he couldn't formally offer their contents to creditors as partial payment of their claims because he doesn't have a liquor license. And he says getting approval to hire a licensed auctioneer to sell the alcohol would have generated more legal fees than it would have paid dividends.
"Generally, my expertise is real estate," says Cohen. "It's rare for me to end up with pieces of personal property like this."
So Cohen asked U.S. Bankruptcy Judge Sidney B. Brooks for permission to dispense the spirits less formally: by splitting the grape among "friends and acquaintances," members of his office staff, other lawyers in his office suite, even other professionals he had hired to work on the Stanley case. And he was willing to cut his buddies a deal, offering to part with the wine for just $5 per bottle. "I would have done a flier to the building and said, 'Come and buy this wine,'" he says. "The idea was just to get rid of it."
However, the prospect of a group of lawyers and accountants toasting one another's good fortune while creditors still waited for their money quickly raised eyebrows. "These are people who charge $250 per hour, and they couldn't resist a good deal on a bottle of wine," comments one attorney familiar with the case.
And Judge Brooks quickly put a cork in the bottoms-up plan. In a July 10 order, Brooks blasted the office-sale scheme as an "unsavory" effort to spread good cheer to the wrong people. The judge also suggested that creditors hadn't been fully informed of the plan.
"The prospect of a trustee selling wine to his friends, his office staff, as well as professionals employed by the trustee in this case, is irregular and controversial at best," wrote Brooks. "It is extraordinary and tainted, if not outright suspect, at worst."
A blushing Cohen, however, insists the judge misunderstood his proposal--and at a July 30 status conference, Brooks backed away from his earlier broadside. The court's response was "not as mellow as it perhaps should have been," Brooks conceded from the bench. "But the court was very concerned about the appearances of impropriety of people walking down the hallway selling off bottles of wine for five bucks a shot." After having heard Cohen's explanation of his other alternatives, Brooks added, he had "no trouble with the procedures and motivation of this trustee."
Cohen says the whole episode left a bad taste in his mouth. "There was no intent, ever, to in any way do anything improper," he insists. Creditors in the Stanley case stand to receive more than 90 percent of the money owed to them thanks to his successful handling of the estate, he says, and the suggestion that he devised the $5-per-bottle scheme as an opportunity to chug-a-lug chardonnay with his friends is ludicrous. "I would never have touched that wine," he adds.
Meanwhile, Cohen says he thinks he's come up with a way to rid himself of the pesky hooch once and for all. One of the other items left over from the estate, he notes, is a grand piano valued at $50,000. By throwing that in with the wine, he says, he has convinced an auctioneer to accept the whole lot and sell it during an auction of art objects and other collectibles scheduled later this month.
"It was only because of the piano that I could get them to take the wine," says Cohen. "It looks like creditors in this case are approaching 90 cents on the dollar. So as a result, now they'll get 90.2 cents or something."
Cohen says he doesn't regret taking the wine from the cellar, despite the trouble it has caused. Abandoning the bottles to the hotel's new owners would have gone against his grain, he says, adding, "I don't like to leave anything for anyone else.
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