New York Distillery Takes Insurance Company to Court Seeking to Recoup $2.5 Million in Damages of Spilt Whiskey

A New York distillery is taking an insurance company to court after the company refused to cover a whiskey spill yielding $2.5 million in damages. (Photo: AP Photo/Mike Groll)

Westfair Business Journal reported on Tuesday that a New York distillery is taking its insurer to court after the company denied coverage in light of the brand facing whiskey losses amounting to $2.5 million.

The incident occurred in December, when a rack loaded with single malt barrels broke and spilled the whiskey at Vale Fox Distillery. The owners took heart knowing they purchased insurance from Central Mutual Insurance Co. and figured the policy would cover the damages.

Yet, their request was denied, and Vail Fox Distillery intends to take the insurance company to court.

“Central Mutual stated (that) … coverage for collapse of personal property did not apply,” Vale Fox Distillery said in a complaint. “despite the fact that its own engineer’s report checks every box required for the collapse coverage to apply.”

The New York whiskey brand specializes in single malts, and it produces a $150 expression named after the scientist Marie Curie. The whiskey is named Curium, and the brand claimed most of the bottles sold out in the tasting room.

Barrels of Curium were held back and moved to a rack to age for an additional three to four years. A manager at the facility discovered on Dec. 19 that the racks broke. Sixty barrels collapsed, and 52 of them broke when they hit the ground, causing the whiskey to spill all over the floor.

The brand claimed the loss amounted to $2.5 million.

Central Mutual hired an engineering company named J.S. Held to visit the site of the incident, and the company initially claimed the racks collapsed due to age. J.S. Held amended its observations in another report and claimed that the racks collapsed due to welding defects. Yet, Central Mutual Insurance Co. still denied covering the losses, claiming the collapse was due to “wear and tear.”

Vale Fox Distillery is accusing Central Mutual of breach of contract and is taking the company to court. Bottle Raiders reached out to Central Mutual with a request for comment and has not heard back at the time of this article’s publishing.

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