After years of court battles, Las Vegas alcohol distributor Larry Ruvo’s company has been awarded more than $5 million from a competitor that was found to have illegally undercut him.
But whether Ruvo collects all of his court-ordered payments is another issue.
District Judge Mark Denton on Tuesday ordered alcohol distributor Guy Azera’s companies to pay Southern Wine & Spirits of Nevada $5.36 million in damages, fees and interest.
The ruling comes almost a year after a local jury found that Azera’s firms had committed fraud, civil conspiracy, unfair competition and other tactics that illegally crimped Ruvo’s business.
It was the first time a Nevada jury awarded punitive damages for violations of the state’s alcohol distribution laws, and Ruvo’s victory in the case helps ensure that consumers drink authentic, quality alcohol, his attorney E. Leif Reid said.
According to Ruvo’s lawyers, Azera supplied alcohol to himself — from a company he owns in Southern California, Transat Trade, to one he owns locally, Chateau Vegas Wine — in violation of both Nevada law and Ruvo’s exclusive distribution agreements.
Azera allegedly brought booze across state lines in a vegetable truck, and at least some of his Cristal Champagne bottles were impounded by U.S. Customs agents and kept in an unrefrigerated warehouse for a lengthy time until Azera sued and secured their release, according to Reid. Even though his Champagne had spoiled, Azera sold the bottles for public consumption, Reid said.
“We’ve been waiting for this,” Ruvo said of the judge’s order.
Azera, who said this week he is traveling in France, did not respond to questions about the case.
Ruvo, a longtime valley businessman, is senior managing director of the Nevada division of Miami-based Southern Wine & Spirits of America. His company initially sued Chateau Vegas in December 2002 in Clark County District Court. It was joined in the case by Maisons Marques & Domaines USA, which, at least at the time, was the exclusive U.S. importer and distributor of Cristal.
They alleged Chateau Vegas was selling liquor that, under state law, it had to buy from Ruvo’s company. According to the suit, Azera’s firm was acquiring alcohol from “unauthorized or ‘grey market’ sources,” and as a result, was illegally slicing Southern Wine’s and MM&D’s profits.
They sought, among other things, punitive damages and an injunction against Chateau Vegas. The six-page lawsuit unleashed years of court battles — including a trip to the Nevada Supreme Court, which in fall 2011 upheld a District Court ruling in Ruvo’s favor — and racked up huge legal bills.
Of the money awarded this week to Southern Wine, $2.06 million was just for attorney’s fees, an amount that Reid called “unprecedented.”
Denton also ordered Azera’s companies to pay MM&D roughly $100,300.
Ruvo and MM&D might have trouble collecting, though, as their adversary is bankrupt.
Azera filed Chapter 11 bankruptcy protection for both Chateau Vegas and Transat Trade last July, less than two weeks after the Clark County jury found that his companies had undercut Ruvo.
In their bankruptcy filings, both firms claimed to have $1 million to $10 million in debt, including a “disputed” $1.2 million claim by Southern Wine.
Reid said he expects his client to get paid, adding that a bankruptcy judge is scheduled to hold hearings in mid-August to determine how much Ruvo’s company collects.
“The funds are there,” Reid said.