First Citizens sues Sonoma winery for $17.5 million debt

First Citizens Bank & Trust Co. filed a lawsuit on Nov. 4 in Napa County Superior Court to recover at least $17.5 million in unpaid principal and interest from Ehren Jordan Wine Cellars. The bank, which inherited the loan through its acquisition of Silicon Valley Bank, is asking the court to authorize the foreclosure of five properties owned by winemaker David Ehren Jordan in Napa and Sonoma counties. Interest on the debt is currently accruing at a rate exceeding $2,500 per day.

The legal action follows a series of amendments to a loan agreement originally signed in April 2022. The latest amendment gave the winery until April 30 to find an investor or buyer willing to contribute at least $8 million toward the debt. The bank alleges that Jordan and the company failed to meet that requirement. Neither Jordan nor the bank responded to requests for comment regarding the lawsuit.

Ehren Jordan Wine Cellars produces Failla Wines, an award-winning label founded in 1998 by David Ehren Jordan and his wife, Anne-Marie Failla. The company is part of a wider group of California producers facing financial pressure as consumer habits shift. The Wine Institute, an industry advocacy group, reported that California wine exports to Canada fell 78% in 2025. This drop represented a loss of $357 million in export value, though the decline has since stabilized without a full recovery in total numbers.

Domestic consumption trends also indicate a structural change in the market. The International Organisation of Vine and Wine stated that U.S. wine consumption declined by 4.3% last year. The organization attributed this drop to a wider variety of alcoholic beverage options and reduced drinking among younger demographics. An industry report from First Citizens Bank noted that U.S. wine case sales dropped from 427 million in 2020 to 329 million in 2025. Total spending in the sector fell from $94 billion to $74 billion over the same period.

Other major producers have also cut operations in response to the slump. In September, Gundlach Bundschu, California’s oldest family-run winery, filed for bankruptcy protection after failing to restructure its debt. Signorello Estate in Napa Valley and Robledo Family Winery in Sonoma also filed for Chapter 11 protection this year. Passaggio Wines, based in Sonoma County, ended operations in October after two decades in business. Gallo Family Vineyards announced earlier this year that it would lay off more than 90 employees by the end of January 2027 and close a Napa Valley facility. Constellation Brands, which owns Robert Mondavi, laid off 212 workers at its Mission Bell Winery in Madera in February as it shifted focus to its beer brands.

The next step in the Ehren Jordan case is a court hearing to determine whether the bank can proceed with the foreclosure of the five properties.