Management of Southern Boundary Wines deliberately mislabelled wine, pressured employees to carry out the fraud and bad-mouthed the whistleblower who told Primary Industries. Scott Berry, Andrew Moore and Rebecca Cope were convicted of breaching the Wine Act.
The High Court was told Primary Industries spent over $700,000 getting to the bottom of the wine fraud, much of that expense incurred unravelling misinformation provided by Southern Boundary management ‘explaining’ the mislabelling. Andrew Moore was Southern Boundary CEO; Scott Berry production manager.
Southern Boundary produced wine from its own grapes and also produced wine on contract from other grape growers. The Wine Act sets specific requirements for wine labelling; the so-called ’85 per cent rule.’ At least 85 per cent of the wine in any bottle must comply with any single grape variety, vintage or location described on the label.
Evidence was given of wholesale fraud: grapes from different regions were mixed together without labelling the blend; grapes from one region mislabelled as being from another; and years of vintage mislabelled. In a period when Southern Boundary produced about 40,700 litres of sauvignon blanc, the company bottled 70,100 litres supposedly all its product and exported 63,600 litres. Much of the offending took place in 2012-2013.
Grape growers delivering grapes to Southern Boundary suffered damage to their reputation where the product sold under their label was not true to origin. Wine had to be dumped. One grower suffered losses in excess of one million dollars. Names of growers affected were suppressed by the court.
Described as the principal offender, Berry faced imprisonment. Justice Dunningham replaced imprisonment with 42 weeks home detention and ordered payment of $25,000 reparations. Berry pleaded guilty, sold his home to fund reparations and agreed to front industry workshops telling others of the consequences of his criminal behaviour.
Moore also potentially faced prison. He was sentenced to ten weeks home detention and ordered to pay $20,000 reparation.
Cope was ordered to do 200 hours community service. She said she simply did as instructed, being a relatively new employee at Southern Boundary, overworked and poorly supported.
Whistleblower Joanne Eaton spoke bitterly about the consequences of alerting Primary Industries to the mislabelling fraud. Primary Industries told her to keep quiet while it investigated. In the vacuum that followed she was bad-mouthed by Southern Boundary, hounded out of the industry and forced to retrain in a less lucrative occupation.
Southern Boundary Wines Ltd is in liquidation, insolvent.
R. v. Southern Boundary Wines Ltd, Berry, Moore & Cope – High Court (13.03.20)
20.057