In 1847 Lassen, as a part of Commodore Robert F. Stockton's party, returned to Missouri, in hope of encouraging emigrants to settle at Benton City.
When Lassen arrived back at Benton City he found it nearly vacated, the settlers having left to join the Gold Rush.
Seeking to profit from the gold rush, in 1850, Lassen sold two-thirds of his land to partners General John Wilson and Joel Palmer.
With the sinking of the "Lady Washington", the departure of settlers for the gold mines, and other financial problems, Lassen was forced to sell his remaining one-third interest in the rancho together with his claim against Wilson and Palmer to Henry Gerke in 1852.
With the cession of California to the United States following the Mexican-American War, the 1848 Treaty of Guadalupe Hidalgo provided that the land grants would be honored.
[9] Henry Gerke (1810–1882), a German immigrant and a prominent San Francisco businessman, expanded the vineyard and operated a successful wine and brandy business.
The vineyards eventually covered 3,575 acres (14 km2), but in the intemperate climate the vines provided poor wine, and brandy became the principal product.