Beam Sued for $100 Million Over Irish Whiskey Supplies

March 4, 2013 – Beam Inc. has been sued in federal court by Sidney Frank Importing Co. over a contract to supply bulk whiskey used for the Michael Collins Irish Whiskey brand. Sidney Frank is accusing Beam of breaching a contract it inherited in the December 2011 acquisition of Ireland’s Cooley Whiskey Company.

According to Law360.com, the lawsuit alleges that Beam and its Cooley unit are trying to rid the market of the Michael Collins brand in favor of its own Kilbeggan brand. Cooley supplies Sidney Frank with whiskey for Michael Collins under a long-term supply contract negotiated with the former owners of Cooley, an investor group led by John Teeling.

The lawsuit claims the Teeling group, which is not named in the suit, consistently maintained that Cooley had enough production capacity to supply whiskey for Michael Collins “well into the future.” However, after Beam acquired Cooley, that relationship changed, and Sidney Frank now accuses Beam of monopolizing Cooley’s production capacity for Kilbeggan and its other company-owned brands. The lawsuit also alleges that Beam is trying to undermine Sidney Frank’s relationships with distributors by telling them that “Michael Collins is going away.”

Beam’s Clarkson Hine told Law360.com that the company won’t discuss the claims of the lawsuit, but that Beam is confident in its position and expects to prevail. Spokesmen for Sidney Frank declined to comment.

This is not the first instance where Beam has cut off supplies of bulk whiskey from Cooley to outside producers. The owner of Slane Castle Irish Whiskey complained last year that Beam/Cooley refused to supply whiskey for his brand last year after his supply contract expired.

Links: Law360 | Beam | Sidney Frank