12 CapitalPress.com
October 20, 2017
Jackson Family’s most visible label is Kendall Jackson
WINE from Page 1
But it has fallen to her to
usher “Big Ag” into Oregon.
Jackson Family Wines,
based in California, has more
than 40 properties in the U.S.,
France, Italy, Chile, South
Africa and Australia. A trade
publication, Wine Spectator,
reported in 2012 that Jackson
Family had annual revenue of
$500 million. The entire Ore-
gon wine industry, including
725 wineries, had $529 mil-
lion in sales in 2016, accord-
ing to a census commissioned
by the Oregon Wine Board.
Jackson Family’s most vis-
ible label is Kendall Jackson,
which includes the best sell-
ing Chardonnay in the U.S.
for 25 years straight.
If it isn’t top tier wine, the
Kendall Jackson sales “keep
the lights on” and make the
rest of the company’s estate
brands possible. “Thank God,
drink it up,” Keegan quipped
on a video produced for the
Oregon wine archives at Lin-
field College in McMinnville.
Jackson Family Wines be-
gan its move into Oregon five
years ago, buying a succes-
sion of highly regarded Willa-
mette Valley vineyards: Pen-
ner-Ash, Willakenzie, Gran
Moraine and Zena Crown.
The company then began
building the state’s largest
winery, a 68,000-square-foot
facility directly across the
highway from the Evergreen
Aviation museum and water
park site in McMinnville, the
Yamhill County seat and the
heart of Oregon’s wine coun-
try.
The vineyard acquisitions
and winery construction sent
a collective ripple through
Oregon’s wine industry, be-
gun and nurtured over the past
40 years by quirky, driven
individuals who nonetheless
quickly recognized that col-
laboration was the key to suc-
cess.
They knew Oregon would
never match California’s
crop size, and shouldn’t try.
Instead, they focused from
the beginning on quality, not
quantity. Oregon Pinot noir,
which emerged as the state’s
signature wine, commonly
sells for $40 to $65 a bottle or
more. Would Jackson Family
undermine that carefully nur-
tured market niche with $15
corporate Pinot or low-price
blended reds?
“There was concern about
a big California property
coming up here,” said Ellen
Brittan, who with her hus-
band, Robert, owns Brittan
Vineyards near McMinnville.
“The last thing we wanted
to do was change the culture
up here.”
“The story of the Willa-
Eric Mortenson/Capital Press
Jackson Family Wines employees make last-minute checks at the company’s new winery in McMinnville, Ore. The company’s expansion
in Oregon may mark a turning point in the state’s small but high-quality wine industry.
mette Valley is out of left
field,” pioneering winemaker
David Adelsheim said in an
interview earlier this year.
“A group of people became a
bigger group of people, which
became a bigger group of peo-
ple.
“I’m not sure you could
change it successfully,” he said.
“You can’t change that focus
and vision by snapping your
fingers. There’s no one thing,
no one person, no one winery.
But there is one grape, maybe
that’s what you can say.”
The Oregon Way
Eugenia
Keegan
is
Adelsheim’s longtime part-
ner, and is in Oregon because
she chose to join him. With
Jackson Family Wines mov-
ing into the state, the two of
them decided in March 2013
to approach the newcomers.
“In the style of Oregon,” as
Keegan describes it, they in-
vited them to lunch to talk
things over.
Company Chairman and
Proprietor Barbara Banke,
an attorney who founded the
company with her late hus-
band, Jess Jackson, attended
with members of her family
and select company officials
in tow.
The two women hit it off.
Keegan remembered that her
family’s ranch near Petaluma,
Calif., in Sonoma County,
was next to Jackson Family’s
La Crema wine property. For
her part, Banke was “bullish”
on Oregon, Keegan said.
“There was no desire to
change the Oregon culture or
the way we do things,” she
said. “They were impressed
Eric Mortenson/Capital Press
Pinot noir grapes, Oregon’s signature wine, tumble over a convey-
or into a tank at Jackson Family Wines’ new winery in McMinnville,
Ore.
with what we’d built here.
They invested in the way we
do things.”
So much so that the com-
pany asked Keegan to head its
Oregon operations.
Some Oregonians re-
mained skeptical until the first
wines emerged from Jackson
Family’s newly purchased
Willamette Valley vineyards.
“Oh yeah, they came here
to follow the tradition,” Kee-
gan describes the reaction.
“Oh yeah, they get it.”
Her partner, Adelsheim,
agrees. “Jackson Family, in
essence, just bought into it,”
he said.
Willing partners
The industrially zoned
property across from the
museum and water park was
what Jackson Family was
looking for, and McMinnvile
city officials were happy to
help with the required per-
mits and inspections. Jody
Christensen, executive di-
rector of the city’s Econom-
ic Development Partnership,
called it a “significant devel-
opment” for the community.
McMinnville scored an-
other agriculturally related
development this year when
Organic Valley, based in
Wisconsin, bought and refur-
bished the Farmers Creamery
Cooperative, spending more
than $12 million in excess of
the purchase price to update
the plant. When production
goes full bore, the facility
will produce 4 million to 8
million pounds of organic
butter per year, along with
powdered milk.
The Jackson Family and
Organic Valley operations
are what economists call de-
sirable “value-added” manu-
facturing. That is, they pro-
duce and sell a finished good
rather than ship raw material
elsewhere.
That’s important because
food and drink processing
proved resilient during the
recent recession. It was the
only Oregon manufacturing
sector that didn’t lose jobs
during the recession, and the
only one to reach an all-time
high — more than 28,000
jobs in 2015 — during the
recovery.
Neither facility will re-
quire vast work forces: About
15 seasonal workers join 10
full-time workers at Jack-
son Family, and the butter
plant will employ about three
dozen workers by next year.
However, in a town of Mc-
Minnville’s size, 35,000, the
impact is magnified.
The parcel and an existing
office purchased by Jackson
Family had belonged to Ev-
ergreen Aviation, and had sat
empty for some time. The
office building became the
hub for Jackson Family’s Or-
egon operations and the new
winery rose behind it. In ad-
dition, the company contract-
ed with a local architect and
construction firm.
Mitch Davis, a Jackson
Family senior vice pres-
ident, said the facility is
the company’s administra-
tive hub in Oregon and will
serve as a lab and custom
crush operation for the com-
pany’s winemakers at other
properties.
“One of the things our
ownership very much wants
to do is control the wine-mak-
ing process themselves,” Da-
vis said.
“The last thing you want to
call this is a ‘plant,’” he said.
“This is an artisanal winery,
and we built it for the future.
You don’t know what’s going
to happen down the road; we
built it so we don’t paint our-
selves into a corner.”
Davis
acknowledged
Jackson Family is conscious
of fitting in.
“We don’t want to be a
California company that’s
trying to play Oregon,” he
said. “We want that group to
feel very much Oregonian.”
Ellen Brittan said the
company acted wisely.
“The biggest thing they
did was hire Eugenia,” she
said. “Rather than send
someone up from California,
which I think would be a big
mistake.”
The company’s size will
benefit Oregon, she said.
“They’re able to amplify
everything we’re trying to
communicate,” she said. “We
just don’t have the mega-
phone that Jackson Family
has around the world.”
The powerhouse
Eugenia Keegan leads
a tour of Jackson Fami-
ly Wine’s facility. The first
grapes are arriving, and fork-
lifts buzz to unload trucks.
Conveyor belts carry grapes
into crushing tanks, bare
stems emerge for disposal,
and pipes carry fresh juice
to rows of gleaming tanks.
The first wines will emerge
from here this year. Keegan
likes to say the crucial work
is done in the vineyard —
vines are not widgets — and
the fermentation process in
the winery is where the fruit
learns to express itself as
wine.
She wears jeans and a
Tartan plaid shirt set off by a
strand of pearls. Young men
and women, seasonal interns,
bustle about the facility. Each
year, a few are hired full-
time.
Keegan once told an in-
terviewer that she hopes to
help young people under-
stand how wonderful and
how small the industry is.
The person you’re talking
with today may be your boss
tomorrow.
Keegan fondly recalls be-
ing an intern once herself,
decades ago in France. She
recognizes which of these in-
terns have, like she did, fall-
en in love with the art, sci-
ence, sweat and pressure of
making fine wine. She notes
the ones that jump to learn
new things, and beam with
accomplishment.
“I can tell by the end of
the first day,” she said.
Easement terms can be evaluated based on
reasonable expectations, community standards
POT from Page 1
Dan Wheat/Capital Press File
Wheat is harvested near LaMoine, Wash. Low wheat prices are one area of disappointment for
Northwest farmers, who will see small profits for most of the crops grown in the region, according to
a Northwest Farm Credit report.
Report anticipates fresh potato prices will
increase after harvest into profitable territory
REPORT from Page 1
from dumping sugar onto the
U.S. market have strength-
ened sugar prices, and they’ve
been pleased by Northwest
yields and sugar content.
The report anticipates
fresh potato prices will in-
crease after harvest into prof-
itable territory, highlighting a
4.6 percent reduction in Ida-
ho’s 2017 planted acreage.
Oakley, Idaho, fresh grower
Randy Hardy has been en-
couraged that processors are
buying growers’ production
overages, unlike last season,
and at-harvest fresh prices
haven’t dropped as signifi-
cantly as last season. There’s
also ample spud storage this
season, which was full during
the 2016 harvest, Hardy said.
“Once harvest is over and
the storages are buttoned
up, we’ll probably see some
price strengthening sooner
than normal,” Hardy said.
Rick Naerebout, CEO of
the Idaho Dairymen’s Associ-
ation, said his members have
earned revenue slightly below
the break-even point for the
past 24 months. USDA has
forecast somewhat optimis-
tic milk prices of $17.70 to
$17.90 per hundredweight in
2017, but Naerebout is con-
cerned about tight labor and
“tremendous uncertainty” re-
garding trade with Mexico.
Oral arguments over the
Wagners’ motion to dismiss
were held in McMinnville,
Ore., on Oct. 11 before Yam-
hill County Circuit Court
Judge John Collins.
The damages alleged by the
plaintiffs are not actionable in
court because they’re based on
proposed activities that hav-
en’t yet occurred, she said.
“Even if we assume there
is an odor, there’s no evidence
it will travel over the plain-
tiffs’ property line,” Bizzano
said.
According to the plaintiffs,
the Wagners are not protect-
ed by the “right to farm” law
because “foul-smelling par-
ticles” from marijuana will
impermissibly harm wine
grapes already growing on the
Momtazi property and which
have yet to be planted on the
Mahesh property.
“They’re in the zone of
danger in how their grapes
might be affected by the mar-
ijuana operation,” said Rich-
ard Brown, the plaintiffs’ at-
torney.
Oregon’s “right to farm”
statute doesn’t immunize
against complaints over
“damage to commercial ag-
ricultural products” filed by
other farmers, Brown said.
“It was about suburban
encroachment on farms, and
not about claims against one
farmer by another farmer,” he
said.
The plaintiffs disagree
their lawsuit is based on
speculative injuries, arguing
that judges can issue injunc-
tions that stop future unlawful
or harmful conduct.
“If the court allows them
to develop the property first,
it’s the equivalent of letting
them pull the trigger,” Brown
said.
At this point, it’s not nec-
essary for the plaintiffs to
prove what type of particles
may affect grape skins and
how far those particles will
travel, he said.
To survive a motion to
dismiss, it’s enough for the
plaintiffs to show the Wagners
planned to grow and process
marijuana — as evidenced by
site plans submitted to Yam-
hill County, Brown said.
“They have a plan.
They’ve announced they have
a plan. We know they’re go-
ing to do it,” he said.
The Wagners countered
that unknown events — such
as wind direction — don’t
count as evidence that would
justify an injunction against
planting a crop.
“What if they want to
grow lavender? What if they
want to raise horses?” said
Bizzano. “Nobody knows if it
will ever impact the plaintiffs.
They’re just scared.”
The plaintiffs initially
sought a temporary restrain-
ing order against the Wag-
ners’ marijuana grow site and
processing facility, but that
request was denied earlier this
year.
Even so, the Wagners
failed to get approval for the
processing facility from the
county government, so it ap-
pears that portion of the proj-
ect isn’t yet moving forward.
In the most recent version
of a complaint proposed by
the plaintiffs, their request for
an injunction against the proj-
ect seems to have been scaled
back.
The proposed injunction
would prevent the Wagners
from growing marijuana with-
in 400 feet of either plaintiff’s
property, instead of prohibit-
ing them from cultivating it.
Another factor in the liti-
gation is a road easement the
Wagners have across the Ma-
hesh property.
The Wagners claim they
haven’t unlawfully used the
easement as claimed by the
plaintiffs, since the easement
terms don’t restrict or prohibit
farming operations.
The plaintiffs argued the
judge could interpret the
terms of the easement, much
like he would a contract.
In this case, the illegality
of marijuana under federal
law also affects the ease-
ment’s permissible uses,
Brown said.
Easement terms can be
evaluated based on reasonable
expectations and community
standards, he said. “The court
has the authority to reason-
ably construe easements.”