The winery owner, Fred Franzia(Bronco)
, is one of a kind. He buys up the wine glut in California and sells it under many labels.
Charles Shaw was once a higher end winery, Fred bought the name and started to bottle wine exclusively for Trader Joe's. I believe it is only sold for in California for 2 bucks, everywhere else for 3 bucks.
So, depending on what winery has a glut, or is hurting for cash, you could be drinking a $25 Napa Cab for your 3 bucks. Although most is blended for consistency.
In the early years, people would go into Trader Joe's, buy a bottle, take it outside, open it and taste it. If it was good, they would buy cases, if not, they would wait a couple weeks for a different bottling.