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Sour Grapes: How Expert Testimony Helped Convict The Biggest Wine Fraud in History

Sour Grapes Expert Witness

While many people around the world enjoy collecting and drinking fine wines, only a relative few have created a multi-million dollar empire from it. But that is exactly what Rudy Kurniawan did. Kurniawan was an unknown twenty-something when he began to rub elbows with wealthy Wine collectors and infiltrate the elite world of wine connoisseurs. As his reputation and knowledge grew, Kurniawan became known as one of the leading experts in wine, amassing millions of dollars by selling rare vintage bottles. The only problem, however, was that the wine was counterfeit. By swapping expensive brands with cheap wine he produced at his home, Kurniawan was able to swindle millions out of collectors and connoisseurs eager to purchase the prestigious names. Kurniawan was arrested in 2012 and convicted in 2013, becoming the first person in the United States to be convicted of wine fraud. As a high-ranking member in the exclusive inner sanctum of expensive wine collecting, Kurniawan was a part of a world that few could comprehend. As such, wine experts played a critical role in the conviction of Kurniawan. Recently featured in the Netflix documentary, “Sour Grapes,” the Kurniawan trial showcases the finely tuned and particularized expertise of wine experts, while making history as the first conviction of its kind.

What is Wine Fraud?

Rudy Kurniawan began his scheme like many con artists begin schemes – he gained the trust of those around him. He made a name for himself in the Los Angeles scene by hanging around expensive restaurants and wine auctions. Posing as the son of a wealthy Sino-Indonesian family, Kurniawan was generous and ostentatious. He spent vast amounts of money on dinners and wine on his new friends. Seemingly impressed by Kurniawan’s deep pockets, no one bothered to question him about the details of his life.

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Initially a purveyor of pinot noir, Kurniawan developed a taste for Burgundy, a more glamorous and expensive brand. He then began to buy and sell wines at auctions, amassing what appeared to be an impressive collection of rare and vintage bottles. In one auction in 2006, Kurniawan sold a record-breaking $24.7 million dollars worth of wine. He also sold his wine to restaurants and private collectors, allegedly authenticated by the most discerning connoisseurs.

Eventually, suspicions grew around Kurniawan’s collections. One of his auction lots included bottles of Domaine Ponsot Clos Saint-Denis from the years 1945, 1949, and 1966. However, that particular wine did not start production until 1982. Around that same time, American billionaire, Bill Koch, found fake bottles in his own wine collection, and hired private detectives to investigate. Authentication experts began to see more and more questionable bottles on the market, and soon after, the FBI got involved. In March 2012, Kurniawan’s house was raided, uncovering a sophisticated wine counterfeiting workshop, complete with corking tools, labels, empty bottles, and recipes for faking aged Bordeaux. Unbeknownst to his buyers, Kurniawan had been placing cheaper wine in expensive bottles, even going so far as to alter the labels so that the bottle appeared to be from more prestigious brands.

Kurniawan was arrested and charged with five felony counts of mail and wire fraud in the United States District Court of the Southern District of New York. However, this was by far the average fraud case.

The Trial of Rudy Kurniawan: Expertise of Lavish Proportions

Ironically, the most expensive wines are so rarely imbibed by their collectors that few can claim to be an expert of their taste. The leading industry expert, Robert Parker, scores wine on a 100-point scale, his critiques are given so much deference that they affect a wine’s pricing. A Princeton economist developed an algorithm based on weather data from the grape’s crop growth period that correlates with Parker’s scores. Therefore, Kurniawan’s conviction was arguably hinged upon the prosecution finding a viable expert witness in the high-end wine industry.

At trial, Michael Egan, of Bordeaux, France, was the principal expert witness for the prosecution. Eagan had examined over 1,077 counterfeit wines over his career that were sourced from Kurniawan, including the 267 bottles seized from Kurniawan’s home. The witness explained how labels had been created and altered to mimic rare bottles of expensive wine. Three of Burgundy’s top experts also took the stand to testify as to the authenticity (or lack thereof) of Kurniawan’s collection. Foil capsules, corks, labels, and bottles found in Kurniawan’s home were also admitted as evidence by the prosecution and used as demonstrative aids throughout testimony.

In December 2013, the jury found Kurniawan guilty of counterfeiting wine. Besides the wine fraud, Kurniawan was also found guilty of bank fraud relating to a $3 million loan he obtained by providing false information. On August 7, 2014, Kurniawan was sentenced to ten years’ imprisonment. He was ordered to forfeit $20 million and to pay $28.4 million in restitution to his victims.

While Kurniawan’s case seems to be one-of-a-kind in both size and scope, it appears that wine experts will be in demand for quite some time. In May 2016, a Singapore investment firm filed a lawsuit in New York, alleging that 132 bottles of wine purchased from Kurniawan for $2.45 million are not authentic. With countless bottles of Kurniawan’s faux brands at large in the market, there is no telling how many lawsuits will emerge in the future.

The notoriety of Kurniawan’s case has shone light on a widespread problem of wine counterfeiting, its prevalence not just in regard to high-end labels. As wine fraud expert, Maureen Downey states, “It’s not all about the $20,000 bottle of Domaine de la Romanee-Conti. You look at Jacob’s Creek…it gets counterfeited like crazy. Angelina Jolie and Brad Pitt’s Miraval Rose sells for about $20, but is being counterfeited all over the world.” Therefore, as wine fraud pervades the market and the number of law suits increase, wine experts will become increasingly utilized.

The post Sour Grapes: How Expert Testimony Helped Convict The Biggest Wine Fraud in History appeared first on The Expert Institute.



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