Rosenstiel, Lewis (1891–1976), was a whisky baron who ruled with an iron fist. For most of his life Rosenstiel ran Schenley Industries, which through a number of shrewd moves he turned into a giant spirits company that owned brands located around the world, including I. W. Harper and Ancient Age bourbons and Dewar’s scotch whisky. “A prodigious worker,” according to his obituary in the New York Times, “Rosenstiel thought nothing of calling his associates at any hour, day or night, to discuss business.” The paper also called him “at one time the most powerful figure in the distilled spirits business.” Born in Cincinnati, Rosenstiel was entirely a self-made man, having left school at sixteen and begun in the liquor business soon after.
It was none other than Winston Churchill who, in a chance encounter in 1922 along the French Rivera, inspired him to buy his distilleries. Churchill, according to reports, tipped him off that alcohol would soon be legal once again in America. Rosenstiel purchased several distilleries that were mothballed during Prohibition as well as a stock of whisky. One of his acquisitions was in Schenley, Pennsylvania, which would become the name of his overall company. After the repeal of Prohibition, the company was the second-largest whisky seller, and he enlisted Lehman Brothers to take Schenley public. At the time, the investment house valued his company at $3 million. By 1935, it had sales of $63 million and earnings of $8 million.
“A domineering man with a quick temper” (as the Times characterized him), Rosenstiel enjoyed an epic rivalry with the Bronfman family, who owned his main competitor, Seagram’s. The two companies battled each other for brands to acquire, market share, shelf space, and, of course, drinkers. See Bronfman family and Seagram Company Ltd.
Rosenstiel famously tried to profit off the Korean War. He figured that, like during World War II, the distilleries would have to shut down to make war goods, which would create a shortage of aged whisky and boost its value. To prepare for this spike in demand, he ramped up production. It was a great plan, except the Korean War didn’t last long enough to require a distilling freeze, and Schenley was stuck with warehouses full of barrels. Not a terrible problem, but after the liquor aged for eight years, he would owe the IRS $10.50 in taxes on every last gallon. Rosenstiel convinced the government to extend the period that whisky could age before taxes are due, thus saving Schenley millions and creating a whole new aged-whisky category. To boost sales he also began aggressively marketing older whiskies to drinkers. This strategy eventually bore fruit, but Rosenstiel did not live to see it. Ironically, one of the main reasons for that is the price war in the bourbon industry that was triggered by his overproduction, which created a perception that the whisky was a cheap, low-quality product. This drove a generation’s worth of status-conscious drinkers to scotch and Canadian whiskies.
Rosenstiel retired in 1968 and sold his controlling interest in the company. It had been run for a number of years by Sidney Frank, husband to Elizabeth, Rosenstiel’s daughter from the second of his five marriages, but Rosenstiel had chased him out of the company, and his shares went to corporate raider Meshulam Riklis. See Frank, Sidney.
See also Dewar’s.
Mitenbuler, Reid. Bourbon Empire. New York: Viking, 2015.
Rothbaum, Noah. The Art of American Whiskey. New York: Ten Speed, 2015.
Sloane, Leonard. “Lewis Rosenstiel, Founder of Schenley Empire, Dies.” New York Times, January 22, 1976, 37.
Veach, Michael. “Overproduction Issues in Whiskey.” bourbonveachdotcom, May 19, 2019. https://bourbonveach.com/2019/05/13/overproduction-issues-in-whiskey/ (accessed March 10, 2021).
By: Noah Rothbaum