Bell’s Sues Distributor
Files suit against Classic Wines in Lansing
Bell’s Brewery has filed a lawsuit in Kalamazoo County Circuit Court against its Lansing-based distributor, Classic Wines Ltd., seeking to stop the sale of distribution rights.
Classic Wines is trying to sell its distribution rights to M&M Distributors Inc., which is also an Anheuser-Busch InBev distributor, according to the lawsuit. The lawsuit claims that M&M’s loyalties to A-B will not allow M&M to fairly promote and sell Bell’s brands. Bell’s, the largest beer producer in the state, refuses to consent to the proposal by Classic Wines to sell the distribution rights because it “does not meet the material and reasonable qualifications and standards required by Bell’s.”
The eight-page complaint addresses Anheuser-Busch’s control of the U.S. beer market and its efforts to “stifle competition” from other Big Beer companies and craft brewers.
Classic Wines is the fourth-largest distributor of Bell’s in the state, selling about 55,000 cases a year, Bell’s president Larry Bell said. Sixty-five percent of Classic Wines sales are of Bell’s brands, according to the lawsuit.
Bell’s pulled out of Chicago in December 2006, after a public dispute with its distributor, Indianapolis-based National Wine & Spirits Inc., which sold distribution rights to another distributor, Chicago Beverage Systems. Just last July, a new distributor for Bell’s was found, allowing the brand to be sold in Chicago for the first time in almost two years.
I think Bell’s is right.
Is the issue that an AB distributer would not sell Bell’s enthusiastically? I think that’s a strong possibility
No this is a new issue to my knowledge, the deal against A-B is what prompted the dissolution of Kalamazoo brewing and the advent of the Bell’s brand. The only legal way for Larry Bell to shake A-B under the state franchise law was to “start a new brewing co”. Technically I think what he did was legally restructure and reincorporate, etc… It was a big stink and it was in courts forever. Then as stated he had his second issue late 2006 where he pulled form Chicago all together. This is the main reason why I personally think the franchise distro-law is outdated and doesn’t meant sh*t to todays beer world. Now that A-B IS the largest distro in the US the idea of tied house prevention has turned completely on its head. This issue is what prompted Ebel brothers to start Windy City distro which is primarily a craft beer business.
here is an article link that explains it all!
http://www.chicagoreader.com/features/stories/bells/