Naperville Business Lawyer Discusses Brewing Beer Battle

beer, Naperville business law attorneyIt is a simple but sad reality of the business world: some brands stand the test of time while others go extinct and fade into the past. For every Coca-Cola, there is a Blockbuster Video, and for every Apple, there is a Compaq. Even brands with storied histories like Woolworth and Oldsmobile have eventually fallen victim to market and industry changes.

As a business law attorney, I realize the attachment that many consumers to for certain brands. For some, it is an issue of quality, while for others, nostalgia plays an important role. It is largely the latter that has beer drinkers young and old concerned about an ongoing lawsuit that could affect the future of an iconic beer brand.

A 20-Year Agreement

In 1999, Pabst and MillerCoors signed an agreement under which MillerCoors would brew several brands of beer for Pabst. The brands included Old Milwaukee, Lone Star, and the best-known Pabst Blue Ribbon. The agreement was set to last until 2020 and included two options to renew for five years per renewal.

Within a few years of the deal’s inception, Pabst Blue Ribbon experienced an unexpected resurgence in popularity. Industry experts speculated that it was the brand’s lack of marketing that appealed to certain groups of beer drinkers, including so-called “hipsters” and the young, “alternative” crowd in the Pacific Northwest. Somehow, PBR, as it is affectionately known, derived a new identity from its consumers rather than from its producers.

With 2020 less than 14 months away, Pabst has a strong interest in renewing the deal. Without the agreement—or one very similar to it—the Pabst brands are unlikely to survive, but it appears that MillerCoors is not so sure about the future of the deal. The larger company is now claiming that it does not have the capacity to continue brewing Pabst’s beers. MillerCoors closed one brewery in 2016 and claims to be on the verge of closing another location soon.

The Legal Battle

Pabst has filed a lawsuit against MillerCoors for breach of contract, saying that the larger company is trying to push the smaller one out of the market in bad faith. Pabst claims that MillerCoors is being deceptive about its brewing capacity, but even if capacity was a problem, Pabst wants MillerCoors to act in good faith to help find a new solution. The smaller company believes that declining brand volume is driving MillerCoors’ refusal to continue helping

MillerCoors says that Pabst is not paying enough to make continuing the deal worthwhile. Additionally, they maintain that they have the right to end the deal when it expires in 2020.

The case has reached the trial stage and is currently being heard by a jury in Milwaukee County Court in Wisconsin.

A Naperville Business Lawyer Can Help You Protect Your Brand

If you have concerns about the long-term stability of your brand, an experienced business law attorney in Naperville can provide the guidance you need. Call 630-756-1160 to discuss your situation with a member of the team at The Gierach Law Firm today. We will help you explore options that could keep your company and your brand viable for many years to come.

 

Sources:

NBC News

The New York Times Magazine

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