A firefighter hoses down a house burning in Santa Rosa, Calif., Monday, Oct. 9, 2017. Wildfires whipped by powerful winds swept through Northern California sending residents on a headlong flight to safety through smoke and flames as homes burned. (AP Photo/Jeff Chiu) (Jeff Chiu)
When the smoke clears from the wildfires burning across Northern California’s wine country—if it ever does—there will be a lot of work to help the region and its residents recover.
At least 29 people have died in the fires so far, and hundreds more are reported missing. The region’s legal industry has also been affected. The fires have destroyed employees’ homes, led local law firms to shutter offices, and disrupted operations as they try to give early guidance to clients in the region.
Carol Kingery Ritter, managing partner of the Napa office of Dickenson Peatman & Fogarty, which has a number of wine industry clients, said three of the firm’s employees have lost their homes in the fires.
“We’re obviously trying to support them however we can,” said Ritter, who evacuated her own home in the middle of the night Sunday at the direction of local authorities, though it’s so far been spared.
The firm’s office in downtown Santa Rosa—near where blazes have reportedly leveled entire neighborhoods—is shuttered for now, chiefly because the fires knocked out internet service in the area, she added. Its Napa office is still open, but many of the lawyers are working remotely.
As for the firm’s winery clients, Ritter said some have called asking about how to recoup losses under federal crop insurance, and some growers have asked about what to do if wineries reject grapes due to smoke taint. But Ritter said the damage to the region’s winery industry doesn’t appear as extensive as she initially expected.
That’s largely because about 90 percent of the grapes were already harvested by the time the fires broke out, and because vineyards—which have more fresh vegetation and not as much dry grass—have actually served as firebreaks, Ritter explained.
“I think people are going to be talking about the 2017 fires for a long, long time,” she said. “But as far as the long-term impacts on the wine industry itself, I’m not that worried about it.”
Carrie Bonnington, a partner in Pillsbury Winthrop Shaw Pittman’s Sacramento office and leader of the firm’s wine, beer & spirits law practice, said that people at the firm have responded by contributing to clothing and gift card drives to help people displaced by the fires.
“We are really trying to get our arms around how our family, friends, colleagues and clients have been affected,” Bonnington said.
Pillsbury’s insurance recovery group is offering any business affected by the fire initial evaluations of their policies and advice on how to proceed with next steps, she said. The firm intends to reach out to clients in the winery and hospitality industry first, but Bonnington said Pillsbury would be “more than happy” to help anyone affected.
With some grapes still on the vine, she said there will be coverage issues related to grape-damage, destruction of case goods and storage, as well issues related to wineries’ relationships with distributors, wholesalers and wine club members.
“We’re trying to pool our efforts internally to make sure we can meet all needs of those affected by the fires,” she said. “I think the biggest impact we’re seeing right now are to the owners and employees losing homes,” she said. “I think a lot of my clients find themselves to be in a place with the shifting winds where it’s a minute-by-minute situation.”
Charles Meibeyer, a member of the wine industry group at Coblentz Patch Duffy & Bass who is based in St. Helena, said many winery clients’ workers have been directly affected by the fires.
“Many, many employees in the wine industry have lost their homes. So they’re trying to make sure all their employees are safe and getting the attention they need,” he said.
Meibeyer added he’s informing clients that they can pay their workers extra to help recover and deduct that under part of the tax code that applies to “qualified disasters.” Those employees can then receive those extra funds tax free.
As for the wineries themselves, he echoed Ritter in saying the damage is not likely to be as widespread as initially feared; but he noted that for the wineries that are impacted, getting insurance to really make up for the full impact of the loss is a challenge.
“The difficulty is you can have coverage for the physical damage, but if you lose a marketing year, that can have a long-term effect that’s hard to value,” Meibeyer said.
“We’re good fighters up here,” added Meibeyer, who has lived in Napa Valley since 1983, “but these kinds of things can shake a community.”
Linda Klamm, an insurance coverage partner at Hanson Bridgett in San Francisco, wrote a blog post in response to the wildfires about her own experiences losing her home in the 1991 Oakland Firestorm. In a phone interview Thursday, Klamm said navigating the insurance claim process post-disaster can be daunting, even for a specialist like herself.
“People are going to be in shock. So it’s going to be hard for some of them to absorb everything,” Klamm said.
She said her firm is organizing community outreach to hold seminars that help people in the rebuilding and recovery process—likely through large employers like the local hospitals. The firm, she said, did similar outreach through local churches after the Oakland fires.
“We’re going to be donating a lot of our time and efforts at Hanson,” she said. “We’re a regional firm and we believe in our communities and neighbors.”
Katherine Philippakis, chair of Farella Braun + Martel’s wine industry practice said the firm’s office in St. Helena, in the heart of Napa wine country, has been closed all week.
“The air quality is terrible and, with the standby to evacuate, most people have decamped,” said Philippakis, noting that this is the first time the firm has closed the office. Philippakis said her practice, which is centered on handling permitting issues for winery and vineyard clients and handling mergers and acquisitions in the industry, has “come to a screeching halt” since fires broke out late Sunday.
“We’ve all agreed to indefinite extensions” on deals, she said. “No one is emailing me about day-to-day business affairs, and they’ve not yet started to email me about losses … I think everyone is in a holding pattern and just watching the news.”
Philippakis said that in recent years both Napa and Sonoma County have ramped up enforcement efforts to make sure that wineries are abiding by limitations outlined in their permits.
“It will be interesting to see what effect the fires will have on that,” she said. She said that the fires will likely “put into context” efforts to crack down on things like wineries that exceed permits by 20 visitors per day. She expects a shift in local politics in the coming months. “But it’s hard to say in what direction.”