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‘Storm’ of negative pr as wine.com sneaks on rivals

Wine.com has brought ‘a bleep-storm of negative PR’ on itself after reporting fellow retailers for breaking state shipping laws.

In a move that has sparked significant controversy in the American wine media and industry, the San Francisco-based online wine retailer initiated a ‘sting’ program against competing US wine retailers.

In the US, complex state laws regulate the shipment of alcohol from one state to another, and some states prohibit interstate shipment by out-of-state retailers or ban wine shipments altogether.

Wine.com has set up a network of warehouses and retail operations in various states so that it legally can deliver wine to consumers in all 50 states. Many other retailers regularly violate the loosely enforced regulations by shipping wine in discreetly marked boxes.

Wine.com placed orders with at least 29 retailers that violated state shipping regulations and then, through its law firm, since last July has been reporting the illegal shipments to state regulators in Washington, New York and other states.

The retailers targeted included California’s Beverages and More!, Sam’s in Chicago and Wine Library in New Jersey.

The move has caused what one blogger called, ‘A bleep-storm of negative PR’ for Wine.com from bloggers and commentators on popular wine-themed blogs like Alder Yarrow’s Vinography.

Yarrow himself compared the sting tactic to ‘taking down the license plate numbers of cars that are going more than 65 miles per hour on the freeway and reporting them to the highway patrol.’

Wine.com CEO Rich Bergsund defended the practice to the Wine Market Report newsletter and also on Vinography, saying that he thinks it’s time for state regulators to either enforce their laws uniformly or open up to interstate shipping.

The move has also generated a row between Tom Wark, executive director of the Specialty Wine Retailers’ Association (SWRA), and Craig Wolf, CEO of Wine and Spirits Wholesalers of America (WSWA).

According to UK journal Off Licence News, Wark criticised Wine.com for its ‘stings on fellow retailers’. This drew the fire of Wolf, who said the SWRA should be more concerned with its members breaking the law than a retailer reporting those violations.

Wark retorted that Wine.com had ‘failed to involve themselves in any of the significant legislative battles that directly effect their customers and wine lovers in general.’

Written by Tim Teichgraeber

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