A federal judge in Manhattan has dismissed a lawsuit filed by once-elite wine seller Sherry-Lehmann accusing New York Times reporter James Stewart and former CEO Michael Aaron of orchestrating a smear campaign that the company blamed for its 2023 collapse. U.S. District Judge Andrew Carter ruled Tuesday that Sherry-Lehmann could not pursue its racketeering claim because it failed to allege that Stewart and Aaron shared a common unlawful purpose.
According to KSL News, which cited reporting from Jonathan Stempel, Sherry-Lehmann had claimed that Stewart and Aaron created popular clickbait stories disparaging the company's business. The company alleged Aaron was trying to avoid his personal guarantee of the firm's rent obligations, and that Stewart hoped to win a Pulitzer Prize by presenting what the company called a false manifesto of purported wrongdoing. Carter also dismissed a related state-law claim that Aaron breached his separation agreement with the company, and he approved a request by Sherry-Lehmann's own lawyers to withdraw from the case, with those attorneys saying they had not been paid.
A Smear Claim That Predates Federal Scrutiny
The lawsuit traces back to a civil racketeering complaint originally filed in May 2025 in the same Manhattan federal court under 18 U.S.C. § 1964, naming Stewart, Aaron, Chris Adams, and Michael Yurch as co-defendants, according to court filings tracked by Justia Dockets. Neither the former Sherry-Lehmann lawyers nor lawyers for Stewart immediately responded to requests for comment, per KSL News. Michael Fischman said in an email that Aaron was pleased with the court's decision, adding that Aaron helped build Sherry-Lehmann over decades and is deeply saddened by what happened to a business important to his family, employees, and generations of customers.
Sherry-Lehmann's roots stretch back to 1934 in New York, when it was co-founded by Aaron's father, a former bootlegger, and his uncle. The retailer later introduced Americans to Dom Perignon champagne in 1947 and supported Georges Duboeuf's Beaujolais Nouveau, building a reputation as one of the country's most storied wine merchants. It also operated a large wine-futures business in which customers paid upfront for bottles delivered years later.
Undelivered Wine and a Federal Investigation
Per the Times, as cited by KSL News, customers complained that Sherry-Lehmann failed to deliver wine they had paid for, including futures orders, and failed to retrieve wine they had stored with the company. The Times reporting also found that Sherry-Lehmann did not pay distributors, sold wine held in storage to other customers, and resisted offering refunds to waiting clients. Reports in 2023 went further, revealing that the company allegedly transferred and sold fine wines held for private clients, including bottles owned by Mercedes Bass and roughly $90,000 worth of 1982 Petrus Bordeaux, according to Entrepreneur.
That fallout drew federal law enforcement to the company's door. In July 2023, agents from the FBI and U.S. Postal Inspection Service, working alongside NYPD officers, executed search warrants at Sherry-Lehmann's Park Avenue storefront and at a storage facility in Pearl River, New York, according to VinePair. The U.S. Attorney's Office for the Southern District of New York had already convened a federal grand jury the previous month as part of a criminal investigation into potential wine fraud and interstate commerce violations, the Business Times reported. The Postal Inspection Service's public role in the raids pointed to federal attention on possible mail and wire fraud mechanisms tied to the retailer's remote sales practices, per Wine-Searcher.
Unpaid Rent, Unpaid Taxes, Shuttered Store
New York State's Liquor Authority closed Sherry-Lehmann's Park Avenue store in March 2023 after its liquor license expired. The company's landlord filed an eviction lawsuit over unpaid rent and won a default judgment of $5.8 million against Sherry-Lehmann, and is separately suing Aaron and Adams over alleged personal rent guarantees, according to KSL News. Court filings cited by The Drinks Business show the company stopped paying rent at its 505 Park Avenue location in March 2020, at the onset of the pandemic, accumulating more than $3.6 million in arrears before the landlord took action.
By April 2023, Sherry-Lehmann also owed nearly $2.8 million in unpaid state sales tax, placing it 12th on the New York State Department of Taxation and Finance's list of the 250 biggest delinquent corporate taxpayers, per the same Drinks Business report. A federal court had already found against the company that June, granting a $251,904 summary judgment in favor of Bordeaux distributor KAL Wine Source over undelivered cases of 2019 Domaine de la Romanée-Conti, according to Wine-Searcher.
Leadership Changes Long Before the Collapse
Aaron stepped down as CEO in 2009 and Adams stepped down from the role in 2020, according to KSL News. Control later shifted to co-owners Shyda Gilmer and former hedge fund executive Kris Green, who oversaw operations during the company's eventual decline, per Grape Collective.
Stewart himself had disclosed in 2023 that he was among the affected customers, saying he lost roughly $6,300 on wine ordered from Sherry-Lehmann that was never delivered, a personal experience he wrote about before his investigative reporting on the company, according to Entrepreneur. Sherry-Lehmann had cast that same reporting as part of what it called a smear campaign, the claim Carter has now dismissed. The dismissal closes out the civil racketeering fight, though the multi-agency federal criminal scrutiny that first brought agents to the retailer's storefront in 2023 has drawn no public update on its current status.
