The Wine Collector

We’ve been talking a lot, in this blog and elsewhere, about the nature of the Assignment process as it relates to Vinfolio, Inc.  The Assignee is working diligently to try to get a quick and speedy positive outcome for the Vinfolio business, while we continue to operate the business, buy wine, sell wine, and provide a Marketplace.  Like other assignment for the benefit of creditor processes, the Assignee is required to provide a mechanism for any party who may potentially have a claim against Vinfolio, Inc. to file their claim.  That mechanism is a “Proof of Claim”, and it’s being mailed to all parties who have interacted with Vinfolio going back over a year to ensure that if they believe they have a claim, it is accounted for.

Proof of Claims are exactly what they sound like.  If you believe Vinfolio owed you money prior to January 15, 2010 (Assignment date) and has not paid you, you’ll need to fill out the form and return it according to the instructions, before July 14, 2010.  The language on the Claim Form is a bit formal and legalistic, but it is just part of the process as we work to resolve the situation.  While we expect to achieve a resolution for the business much sooner (although there is no guarantee of that), claims can still be received and included in the process if properly filled and sent in before the deadline.

We realize the situation has its challenges, but we are focused on minimizing disruptions to day-to-day operations, while the Assignee identifies a buyer and a transaction completed.  We are working diligently to address issues that this situation has created and we ask for your patience as we work through the process.  And as always, if you have any questions, feel free to reach out via telephone to 1-800-969-1961 or via email to service@vinfolio.com.

Many customers have written me since my last post, Progress on payments, seeking clarification as to whether the payments for sellers from new (post Jan. 15) Marketplace and fixed price auction sales are “definitely off limits to creditors.”  The short answer is “yes.”

I understand the language we have used is a bit legalistic but let be call out a paragraph from that prior post again:

“Payment for transactions completed after January 15, 2010 is being managed by the Assignee and, the funds are being segregated for payments owed to sellers (although processing will take longer than usual during the Assignment which took place on January 15).”

The longer explanation can be better understood if I point you to an earlier post, Update from Vinfolio’s Assignee, in which the ABC process is described in more detail.  In particular:

Vinfolio (the “Company” or “Vinfolio”) entered into an Assignment for the Benefit of Creditors (“Assignment”) on Friday evening, January 15, 2010 to Vinfolio (assignment for the benefit of creditors), LLC (“Assignee”), an affiliated entity to Sherwood Partners, LLC (Sherwood”).

The bolded text above references a new company set up by Sherwood, and separately licensed via the CA Department of Alcoholic Beverage Control, through which all transactions are now processed.  On a go forward basis, all sales are being managed by the Assignee and the Assignee is holding the sale proceeds separately, so only sellers have a right to these funds.

Timing of sale-related payments

My last post covered payments (whether cash or credit) relating to January 15th and earlier.  Checks were mailed yesterday (or credits issued) for completed sale transactions during the January 1-15th period.  At this time, for pre-January 1 transactions, we are not able to provide a further update on fixed price auction transactions but our records indicate all completed Marketplace transactions are now caught up in terms of payment (the main reason is that these were on a shorter payment cycle than fixed priced auctions).  Any new owner of Vinfolio assets would determine whether to assume the remaining liabilities associated with fixed price auction sales (or others) for the period prior to January 1.  However, the sale process for Vinfolio, Inc.’s assets is not yet complete and there is no guarantee it will ultimately succeed.

The Assignee (or a successor company that acquires its assets) will ultimately make payments for all sale transactions completed after January 15.  During the Assignment, this process is elongated by a week to 10 days from the prior one as the Assignee has responsibility for this process and must run it through their protocols.  Because sale proceeds are being put in a separate account by the Assignee, Sherwood is able to fund payments to sellers for all transactions after January 15, 2010, and in a worst case scenario, there will be an orderly wind-up (including full payments for the amounts due after January 15, 2010).

I hope this provides further clarification to provide customers with the confidence to proceed with their sale transactions in the Marketplace and via fixed priced auctions.

P.S.    Payments for completed Marketplace and fixed price auction sales during the second half of January will be mailed (or credits issued) on Friday, February 12.