Foppiano family reaches settlement in court case
- Tuesday 3 January 2012
Following three days of legal proceedings, the terms of the settlement will see siblings Susan Valera and Louis M. Foppiano resign their positions as co-trustees and allow the court to appoint an independent third party.
Both will submit names to Judge Mark Tansil by Jan. 15, 2012 at which time Tansil can pick one or choose his own.
Former tasting room manager Susan Valera sued her brother Louis M. Foppiano in an attempt to remove him as co-trustee. The brother denied the accusation of misusing funds, saying he was carrying out a plan to upgrade the business.
The elder Foppiano, 101-year old Louis J., passed control of the corporation to his son in 2005 naming both children co-trustees in 2009.
'It's been a very difficult experience for the family,' said Mike Senneff, lawyer to the younger Foppiano, adding that the decision would have no affect on the winery.
'I think it was in everyone's best interest to find a solution that worked,' said Valera's lawyer, Jeff Terry.
The Foppiano Winery debt is estimated at $4.1 million, with recent sales dropping from an annual 100,000 cases to fewer than 20,000.
In 2008 Louis M. hired professional management and borrowed $2.5 million and testified that his father had invested little money in the business. Louis M. took early loans totaling $650,000 from the family trust, using the trust as collateral for other financing.
Valera said she was refused access to financial records, then suing her brother following her dismissal in 2010.
'We are pleased this matter has been resolved and can now turn our attention back to focusing on getting our wines into the hands of consumers,' said Todd Arterburn, president of Foppiano. 'Louis J.'s having only given up the 'keys to the kingdom' at age 98 created a lot of estate-planning issues which collided with the execution of his trust.'
Bonded in 1896 as winery #312 and branded 1937, Foppiano helped create the Russian River AVA and was one of the first California wineries to use 'Russian River' on its labels.