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An Iconic New York City Wine Store Is Facing a Criminal Investigation Luxury wine purveyor Sherry-Lehmann, which has been in business for 89 years, allegedly owes customers over $1 million in wine that never arrived. The retailer also owes nearly $2.7 million in unpaid sales tax.

By Madeline Garfinkle

Opinions expressed by Entrepreneur contributors are their own.

Ramin Talaie | Getty Images
A customer enters the Sherry-Lehmann wine shop on Park Avenue in New York.

Sherry-Lehmann, founded in 1934 in New York City, has long been a purveyor of luxury wines. However, as of late, the retailer's reputation has been questioned as it faces criminal investigation over customers' claims that wine was ordered, but never received, The New York Times reported.

The breadth of financial loss is not entirely clear, but three former customers filed lawsuits against Sherry-Lehmann for $1 million in wine purchased but never delivered (which the company denies and attempts to dismiss the suits, per The Times).

Other investigation points are $2.7 million in unpaid sales taxes and an alleged $358,000 sale of wine to a real estate investor when Sherry-Lehmann's liquor license was temporarily suspended due to not paying a renewal fee.

Also, some customers' bottles were allegedly being sold to other customers, including Mercedes Bass (former spouse of billionaire Sid Bass) — whose wine stored with Sherry-Lehman had been removed without her permission and delivered to another customer last month, The Times reported.

Shyda Gilmer, co-owner of Sherry-Lehman said the removal and transfer was a mistake, and that the wine would be returned to the family within days — which the company claims the family picked up on June 1. However, a spokesperson for the Bass family told the outlet that the claim is untrue.

Related: Bankrupt Wine Company Owes Millions In Bottles, Customers Left Wondering What Went Wrong and Where the Wine Went

The investigation is being carried out by the U.S. Attorney's Office in Manhattan, the Postal Service, the New York Police Department, and the Justice Department (because some wine was shipped across state lines).

One aspect of the wine retailer's business model was selling "wine futures," wherein customers could purchase vintage cases or bottles in advance to be shipped later on. In the paper's first piece on Sherry-Lehman, published on May 25, the reporter himself says he was one of the customers stiffed by Sherry-Lehman on at least four cases of wine.

"Those bottles never materialized, despite Sherry-Lehmann's repeated assurances that they were on their way, temporarily held up by customs and pandemic-related disruptions," The Times' James Stewart wrote. "I ultimately concluded that I would probably never see any of this wine. I was out a total of about $6,300."

The investigation is still ongoing, and it's unclear what led to the once iconic store's demise, but customers have become increasingly outraged. Year-to-date, every single one of Sherry-Lehman's reviews on Yelp is one-star, as of June 19. "AVOID. Company should be shut down. Failed to deliver my $300 order and failed to offer refund," one reviewer posted.

Related: NYC Wine Store Fined $100,000 for Selling Counterfeit Bourbon

Madeline Garfinkle

News Writer

Madeline Garfinkle is a News Writer at Entrepreneur.com. She is a graduate from Syracuse University, and received an MFA from Columbia University. 

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