THE DALLES — When deliberations began in a recent trial over ownership of a vineyard in Wasco County, jurors quickly sent a note to the judge, asking if they could award full ownership to plaintiff James Martin.
Martin, owner of Sunshine Mill, founder of Copa di Vino, and famed for two appearances on TV show Shark Tank, had sued his former business partner, John Babikian, and was only seeking 50/50 ownership with him of the 400-acre parcel.
The jury was denied their request. All they could grant him was the 50-50 ownership sought.
But, following Martin’s trial victory, giving him a $23.4 million award and half ownership of the 400-acre vineyard property, Babikian agreed to a settlement: Martin would get full ownership of the vineyard, and would not try to collect any cash award.
That settlement was signed Dec. 18, and juror Lana Cael was glad to hear of it recently from a reporter. “It’s a really good end to the story as far as I’m concerned because I feel they’ve been vindicated,” Cael said. “I love it that they got the vineyard.”
In the two-week trial in September in Wasco County Circuit Court, a jury unanimously found that Martin and Babikian were business partners, were 50/50 owners of the vineyard, and that Babikian pursued a criminal conspiracy to try to force Martin to sign the property over to Babikian.
That criminal conspiracy element was a key factor in the damages awarded to Martin. However, his attorneys said, Martin never anticipated getting money from Babikian, who is a fugitive from justice with at least six passports, all to countries without extradition to the United States or Canada, his home country.
The December settlement was an unusually rapid conclusion for such matters.
“It’s important he clear his name so the community and businesses know he didn’t know anything about it, and in fact he was a victim of a scam,” said one of Martin’s attorneys, Adam Starr of Portland trial law firm Markowitz Herbold.
In a statement to Columbia Gorge News, James and Molli Martin said, “The Martin family is happy to finally have this behind us. We believe the verdict speaks for itself. And a big thank you to the jurors of Wasco County, as well as our family, employees and friends who supported us over the last 10 years. It was a very challenging time. We are now looking forward to continuing the development of this awesome Pinot Noir vineyard and the development of our Oregon Mountain Estate.”
Martin appeared on Shark Tank in 2011, becoming the first person not to accept any offers from the show’s panel of investors for his single-serve wine product, Copa di Vino.
After the show aired, some 100 investors called Martin, but Babikian was particularly persistent and ultimately won Martin over, said Starr.
They became partners and friends, traveling the world and dining together. Babikian’s brother even lived with the Martins for a summer. Babikian spent $2 million to buy the 400 acre parcel, and another $5 million in improvements to start planting some acreage into pinot noir grapes.
Babikian said he didn’t like lawyers, and wanted the vineyard deal done on a hand-shake, which is not uncommon in agriculture, said Starr.
Indeed, Cael said some jurors on the case had done handshake deals themselves. She said Martin had vetted Babikian before going into business with him, talking to business partners of his who had good things to say.
“Who thinks that someone could be so crooked?” Cael said. “You don’t expect that.”
But then after work got well underway on the vineyard, Babikian’s money dried up, and he vanished. That’s when Martin learned that federal authorities were pursuing Babikian for a pump-and-dump stock scheme.
Babikian had promoted a stock without telling people he owned shares, then once its value skyrocketed, he sold his shares, crashing the price and netting him $2 million in 90 minutes in one instance, said Starr.
Jurors were told by a retired FBI agent that Babikian was using Martin to launder his illegal earnings, and that Martin had been a mark of Babikian’s ever since Babikian saw him on Shark Tank. He told the jury that a verdict in Babikian’s favor would mean the justice system itself would be used to launder the money.
Babikian wanted Martin to sell the vineyard at one point, making repeated implied threats against he and his family’s lives.
Strange things started happening: Low hovering helicopters, and then an SUV drove through the vineyard property with guys in dark suits giving “looks” to Martin, said Starr.
Cael said several jurors were “really freaked out by that” and didn’t want their identity revealed. “So obviously the threats seemed credible to most of us.”
Martin held fast despite the threats. But that period was an extremely difficult time for him. Martin became emotional when recounting this aspect of the case to the jury, said his lead attorney, Chad Colton.
“It was kind of an electric moment in the courtroom,” Colton said. “This was such a deeply disturbing thing for him, these threats to his family.”
Colton said “probably everybody had that question on their mind: ‘How did you deal with those threats? How did you withstand that?’ And you just saw in that moment how difficult that had been for him. It was so palpable that he had gone through this terrible experience.”
Colton said Martin truly felt an obligation to the community to not walk away from the vineyard and let it grow over and let Babikian “kind of have at it.” It was important to Martin and his wife Molli to be a “good neighbor as a farmer.”
Colton played for the jury portions of Babikian’s deposition, which had been done remotely. Cael said Babikian was “very dodgy. He didn’t want to say where he was. He’d say, ‘I’m in a building.’ It was very clear that he’s a criminal. I don’t know how else to put it. I don’t think anybody had a question about it.”
Finally, Babikian tried to evict Martin from the property, prompting Martin to sue to finally settle who owned the land.
Babikian — who lives in Lebanon, a country without extradition to the United States or his native Canada — would not appear in person at trial. He argued through attorneys that Martin was only an employee at the vineyard, and not a partner.
At points in their partnership, Babikian asked Martin to transfer title of the vineyard to offshore entities “for tax purposes,” Starr recounted. “And James would just do it. He trusted Babikian.”
After Babikian vanished, Martin was left owing some $800,000 to vendors, but Martin eventually paid it.
Currently, 110 acres of the property are planted in grapes. Martin was unable to get business loans on the property to develop it further because it wasn’t in his name, and further, it had a lien placed on it by the SEC as part of the SEC's prosecution of the pump and dump scheme.
Starr said Martin also had trouble getting banks to work with him because of the negative publicity that came out about Babikian.
Colton said, “This was a truly bizarre situation and I’m just so glad for the Martin family that they were able to use the justice system in a way where they could be vindicated and come out of this with a positive outcome.”
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