Wine executive Paul Dolan and his former partners at Mendocino Wine Co. have agreed to drop their dueling lawsuits against each other, ending a more than two-year bitter legal battle that shocked much of Wine Country.
Dolan sued Tom and Tim Thornhill after he was fired as president of the Ukiah winery in January 2012, a dispute where Mendocino County sheriff’s deputies were called to intervene. The three, brought together by their love of organic farming, had formed the company in 2004 after buying Parducci Wine Cellars.
Dolan sued the Thornhills to retrieve a 30 percent ownership stake, with his attorney alleging he was owed millions of dollars from his original $200,000 investment. Mendocino Wine Co. counter-sued, alleging Dolan leaked trade secrets and steered business opportunities away from the company to other businesses where he had a financial stake.
As part of the settlement, both parties will drop their respective suits, and Dolan will drop his federal lawsuit seeking to retain the rights to the Paul Dolan brand. No financial settlement was exchanged between the parties, but hard feelings remain.
Dolan said it was hard to walk away without any financial compensation and give up the rights to the Paul Dolan brand, but added that he could not afford his mounting legal fees.
In March, Dolan sold $1.13 million in stock in Truett-Hurst Inc., where he serves as a director, according to U.S. Security and Exchange Commission documents. Dolan said some of the money from the sale went to pay legal fees.
“I couldn’t financially keep up with (Tom’s) wealth,” Dolan said Thursday in an interview.
He added that the hardest part was giving up his namesake brand, which represents less than 15 percent of Mendocino Wine Co.’s sales, primarily to restaurants. The company touts the brand’s grapes as grown without conventional pesticides and synthetic fertilizers. “The quality is not as good as when I was making it,” Dolan said.
In a separate interview, Tom Thornhill, who serves as chief executive officer, disputed Dolan’s claims and noted that he and his brother had been interested in sustainable business practices before meeting Dolan. The 60-employee winery, he said, has continued to thrive under president Gary Glass, who previously worked for Jess Jackson, Francis Ford Coppola and Constellation Brands.
It produces 200,000 cases annually and does another 200,000 cases as a custom-crush facility for winery clients.