FBN’s Susan Li on Anheuser-Busch InBev turns to hard seltzer because it’s about declining beer sales.
Mexican liquor division Anheuser-Busch InBev has accused the American firm Constellation Brands in a lawsuit filed on Monday that they violated an agreement on the use of the Corona brand by applying it to a product other than beer.
Constellation used the name for its Corona Hard Seltzer, a sparkling water with alcohol and flavorings, one of several seltzer drinks that became very popular in the United States.
The case is the latest in an increasingly competitive and litigious American brewing market.
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Grupo Modelo filed his case Monday in the U.S. District Court in the southern district of New York, according to a court case. AB InBev, which confirmed the submission, said it was not directly compatible with Constellation.
When AB InBev took full control of Grupo Modelo in 2013, it agreed with US antitrust regulators to sell Grupo Modelo’s business in the United States to Constellation, including the Corona brand. AB InBev has retained rights to Corona and other Modelo trademarks in Mexico and elsewhere.
Modelo said the licensing arrangement for Corona only extended to beer and did not include hard seltzer.
Constellation said it was “very surprised” by the development and said Modelo’s allegations, including that the seltzer should not be classified as a beer, were meritorious and an attempt to be a strong competitor. beteuel.
He said he had complied with the provisions of the sublicense agreement “fully and completely” and would strongly defend his rights.
Close up of Corona branded hard seltzer packaging, an alcoholic seltzer water drink, on store shelves in San Ramon, California, July 2020. (Photo by Smith Collection / Gado / Getty Images)
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Constellation launched Corona Hard Seltzer in February 2020 and said in October the brand has 6% of the US seltzer market, making it the fourth largest brand in the segment.
The top spots are occupied by Mark Anthony Brands’ White Claw, Boston Beer’s Truly and Anheuser-Busch’s Bud Light Seltzer.
AB InBev’s US arm Anheuser-Busch won on appeal in May in a lengthy lawsuit against rival Molson Coors over ads highlighting the use of wheat syrup in the Molson Coors drinks Coors Light and Miller Lite.
A US court also ruled this month that Anheuser-Busch should stop marketing the new Michelob Ultra Organic Seltzer as the first and only seltzer certified by the US Department of Agriculture as organic, following a challenge from a brewer in Oregon.