Sacked boss of Australian Vintage considering defamation and wrongful dismissal action

Ousted Australian Vintage CEO Craig Garvin is considering defamation and wrongful dismissal action against his former boardroom colleagues.

The sacked CEO of Australian Vintage, Craig Garvin, is considering legal action against the board for his sudden dismissal Friday.

Craig Garvin, the sacked chief executive of McGuigan winemaker Australian Vintage, is considering a defamation case against his former boardroom colleagues and a possible wrongful dismissal case after the company terminated his tenure this past Friday.

Mr Garvin, who ran Australian Vintage for five years, has held discussions with his lawyers and there is a growing sense he is pursuing possible legal action over his shock dismissal, with his lawyers combing over the ASX statement which revealed his sacking, as well as the terms of his employment contract and relevant workplace law.

In the statement were allegations of a workplace issue which, in the public words of the board, “displayed a lack of judgment”.

The looming court case could involve defamation, with Mr Garvin having a high profile in the business community, especially in the agribusiness and food sectors.

On Friday, Australian Vintage — which has a market capitalisation of just under $90m and whose share price has collapsed by more than 90 per cent against its peaks two decades ago — announced the sudden and shock sacking of its CEO, citing workplace behaviour issues but not detailing those claims any further.

Mr Garvin is considering several legal avenues after suddenly losing his job. Picture: Joe Castro

“After careful consideration and discussion between Mr Garvey and the board, the board has terminated Mr Garvin’s employment for engaging in conduct that, in its view, displayed a lack of judgement and was inconsistent with the values of the company and the high standards expected of its chief executive officer,” the company said.

Australian Vintage did settle some months ago a complaint from a staff member, The Australian can reveal, and many of the parties involved in the workplace dispute believed the matter was settled. However, Mr Garvin was then sacked.

Australian Vintage owns McGuigan wines as well as a small portfolio of other brands, including Tempus Two and Nepenthe.

Australian Vintage chairman Richard Davis declined to comment when approached by The Australian on Tuesday.

Mr Garvin’s immediate dismissal also came at a sensitive time for the winemaker, as it is in deep negotiations with the nation’s second largest winemaker, the debt-laden Accolade Wines, to execute a merger of the two businesses, of which Mr Garvin was expected to lead.

Accolade’s large portfolio of wines include blockbuster labels such as Hardys, St Hallett, Grant Burge and Petaluma, and by combining the two businesses would have given it extra presence, synergies and efficiencies to better compete in what is an increasingly tough wine market.

The largest shareholders in Australian Vintage now fear with Mr Garvin booted it could scuttle the merger talks or place the Australian Vintage board in a less powerful negotiating position as it looks to finalise the deal with Accolade’s private equity owners.

On Sunday, one of Australian Vintage’s key institutional investors registered its grave concerns and anger over the dismissal of Mr Garvin, calling it “bewildering,” and said it feared the backdoor merger of Accolade Wines into Australian Vintage could collapse completely.

“We are extremely disappointed that it has come to this from the board and timing quite frankly is not ideal, it is bewildering,” said Oscar Oberg, lead portfolio manager of WAM Capital.

WAM holds just under 5 per cent of Australian Vintage and Mr Oberg said he was “in the dark” over the reasons for Mr Garvin’s departure.

“It is a disappointing development, the reality is we know very little, if anything, around whatever it was that gave rise to this (CEO departure),” said Simon Mawhinney, managing director of funds manager Allan Gray, which has a 17.4 per cent stake in Australian Vintage and is its largest shareholder.