Wine drinkers who bought from online marketplace Underground Cellar before its collapse are squaring off with its top lender for the rights to more than 500,000 bottles of red, white and rosé in storage, WSJ Pro Bankruptcy reported. Underground Cellar gained popularity among wine lovers because of its gamelike platform offering customers occasional upgrades to more expensive bottles than they had paid for. The company then stored bottles of wine purchased by customers in its “CloudCellar” — a climate-controlled warehouse in southern Napa County, Calif. — until they requested to ship them to their addresses. “I thought they really were good at what they did,” said Michael Klein of Glendale, Calif., a former customer. “It was almost like a lottery or gambling when you bought wine from them, because they promised you these upgrades.” But earlier this year, customers started having trouble accessing the wine they had ordered. Underground Cellar filed for a chapter 7 liquidation in the U.S. Bankruptcy Court in Wilmington, Del., in May, indicating the company would shut down its business. The bankruptcy filing included up to an estimated $11.6 million worth of wine, mostly ordered by roughly 25,000 customers, that has been stuck in limbo at the Napa warehouse. A court-appointed trustee has proposed selling the company’s remaining assets, including the wine, to Liquid Lotus, an entity owned by the company’s founder, Jeffrey Shaw, for $600,000.
