NEW YORK (Reuters) - A billionaire's lawsuit over wine said to be owned by Thomas Jefferson has died on the vine.
A federal appeals court in New York ruled on Thursday that William Koch, the founder of Oxbow Group energy company, had waited too long to file a lawsuit against Christie's auction house.
Koch, a brother of businessmen and conservative political activists Charles and David Koch, had accused Christie's of rubber stamping as authentic a cache of wine said to have been owned by the third U.S. president, while knowing it was worthless plonk.
The 2nd U.S. Circuit Court of Appeals found that Koch failed to conduct timely due diligence when doubts were first raised about the wine's authenticity.
Koch bought four bottles of red wine in 1987 and 1988 that was said to be from 1787 and with the letters "Th.J." etched in the glass. Jefferson was a wine aficionado and served as an envoy to France in the late 18th century. The wines at issue were purported to have been discovered in Paris.
But starting in 2000, reports surfaced that cast doubt on the origin of the bottles, clues that "would suggest to a reasonably intelligent person that the wine was not authentic," the appeals court wrote.
Yet Koch waited until 2005 to begin his investigation into the wine's origin, the court said. Koch's claim, the court concluded, "is therefore time-barred."
Koch purchased the wine from dealer Hardy Rodenstock through intermediaries. In his lawsuit, filed in 2010, Koch contended that Rodenstock and the longtime head of Christie's wine department, Michael Broadbent, were associates in the purported fraud.
Koch, whose worth is about $4 billion according to Forbes magazine, said Christie's had agreed to promote Rodenstock's reputation and sell his wines. His lawsuit also said Christie's had lobbied Monticello, Jefferson's Virginia home, to vouch for the wine.
The appeals court ruling upheld the dismissal of the case by U.S. District Judge Barbara Jones.
Maura Grinalds, a lawyer for Christie's, did not immediately return a call for comment on the ruling.
Brad Goldstein, a spokesman for Koch, repeated the wine collector's allegation that the auction house conspired to sell fake wine. "They got away with it," Goldstein said. "They escaped on a technicality and their behavior warrants closer scrutiny."
Meanwhile, Koch has been pursuing a lawsuit against Rodenstock. In May, a magistrate judge recommended that Rodenstock be fined over $600,000 in damages. Judge Jones, who is overseeing this case, has yet to decide whether to adopt the magistrate's findings.
The case is William I. Koch v Christie's International Inc in the 2nd U.S. Circuit Court of Appeals No. 11-1522.
(Reporting By Basil Katz; Editing by Martha Graybow and Philip Barbara)