Bacardi avoids £51m claim in Brown-Forman lawsui
On Wednesday (19 May), a London court determined that Bacardi UK is not required to make payments its subsidiary allegedly owes Brown-Forman under a cost-sharing deal. Bermuda-based Bacardi and American company Brown-Forman first formed a UK distribution alliance in 2002 and officially ended their relationship in April 2020, after 18 years. The split severed the alignment between Bacardi’s brands – Bombay Sapphire gin, Grey Goose vodka and Patrón Tequila, among others – and Brown-Forman’s portfolio, which includes Jack Daniel’s whiskey, Woodford Reserve Bourbon and Slane Irish whiskey.
In a written argument to the court, Brown-Forman stated the companies decided to go their own ways after Bacardi brought on a new global chief executive who sought structural changes to the business’ Northern Europe operations. Brown-Forman sued Bacardi earlier this year for the £51.5m sum in question, citing payments owed from a cost-sharing agreement inked with a Bacardi subsidiary in 2016. The Bacardi subsidiary has put forward its own cross-claim against its former distribution partner, seeking remuneration for its work as a commercial agent for the Jack Daniel’s owner. Both Brown-Forman’s original claim and Bacardi’s counterclaim will move forward to arbitration.
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