A legal battle between two Bay Area wine companies hinges in part on a word that may sound esoteric to the general public but is familiar to anyone in the wine industry: négociant.
The French term refers to a merchant who buys grapes or wine and then bottles it under their own label. It’s proven a winning business model for many California entrepreneurs — perhaps none more so than Cameron Hughes , who has made a career out of finding high-quality wine at bargain prices, then rebottling and selling it directly to consumers. He did it first in the early 2000s under an eponymous company, Cameron Hughes Wine, then with a buzzy startup, De Négoce , and recently revealed his plans to launch a third act, the Négociant.
Hughes now faces a lawsuit from Martin Ray Winery, to whom he sold the De Négoce business last year for $12.5 million. In the complaint filed in federal court in San Francisco, Martin Ray alleges that Hughes’ new label, the Négociant, infringes on the De Négoce trademark and that Hughes has violated a non-compete contract.
“This is not some stranger randomly coming up with a similar label,” said Spencer Hosie, an attorney for Martin Ray. “Right now he’s trying to have it both ways,” pocketing the $12.5 million from the sale and trying to recreate the company that he sold…