Ernest Gallo, who built one of the world's largest winemaking empires, dies at 97

Ernest Gallo, the marketing genius who parlayed $5,900 and a wine recipe from a public library into the world’s largest winemaking empire, died Tuesday at his home in Modesto. He was 97.

"He passed away peacefully this afternoon surrounded by his family," said Susan Hensley, vice president of public relations for E.&J. Gallo Winery.

Some of Gallo Winery's grapes are grown locally.

Sunnybrook Ranch in east Paso Robles has 500 acres of such varietals as cabernet, merlot, zinfandel and grenache. Red wine grapes dominate, but it also grows viognier and riesling. Owned by Gallo since 1996, the ranch produces 2,500 tons of grapes annually and employs 10 to 50 people.

In San Luis Obispo, Gallo is a partner with Cal Poly's vineyard operations.

Their 90-acre vineyard grows pinot noir, chardonnay and sauvignon blanc grapes. Students work the vines, and when the grapes are harvested and sold, profits are split between Gallo and Cal Poly.

Grapes in the county still account for only a small percentage of the total Gallo uses, but they are used for the brand's higher-end wines, said Jon Winstead, wine growing manager at Sunnybrook Ranch.

Stacie Jacob, of the Paso Robles Wine Country Alliance, said Gallo's local operations give credibility to the area.

"When you have a large company like Gallo who has the opportunity to grow grapes across the state, it's a testament to the quality of grapes grown here in Paso Robles."

Gallo, who would have been 98 on March 18, was born near Modesto, a then-sleepy San Joaquin Valley town about 80 miles east of San Francisco. He and his late brother and business partner, Julio, grew up working in the vineyard owned by their immigrant father who came to America from Italy’s famed winemaking region of Piedmont.

They founded the E.&J. Gallo Winery in 1933, at the end of Prohibition, when they were still mourning the murder-suicide deaths of their parents. Ernest and Julio rented a ramshackle building, and everybody in the family pitched in to make ordinary wine for 50 cents a gallon — half the going price. The Gallos made $30,000 in the first year.

It grew to become the world’s largest wine company by volume, a title since taken by Constellation Brands of New York. But Gallo remains second, selling an estimated 75 million cases under more than 40 labels.

"My brother Julio and I worked to improve the quality of wines from California and to put fine wine on American dinner tables at a price people could afford," Mr. Gallo told The Modesto Bee on his 90th birthday. "We also worked to improve the reputation of California wines here and overseas."

Ernest directed sales, devised marketing strategies and kept a short leash on distribution. Julio, who died in 1993, made the wine.

Gallo was no less tough on the people who worked for him as on those he battled for business. He also demanded total loyalty from his employees. In 1986, when he learned that two longtime Gallo executives were secretly planning to buy a winery of their own, he fired them on the spot.

Gallo was a courtly man who affected Old World manners. But in business he was tenacious, shrewd, aggressive, and secretive. He and others of the Gallo clan shunned publicity like a plague. The reason for the secretiveness, many of their former associates said, was the way his parents had died.

Fresno County records say their father, Joseph, shot their mother, Susie, to death in June 1933, then killed himself. That was two months before the founding of the Gallo winery.