Toledo beer distributor sues MillerCoors

12/23/2008

But now the firm, whose trucks bearing Miller beer logos are a familiar sight in the area, is threatened by its largest customer's plan to streamline distribution channels.

Metropolitan, in a lawsuit filed in U.S. District Court in Toledo this month, contends that recently formed MillerCoors LLC wants to turn its distributorship over to a company called B&B Beer Distributing Co., in Grand Rapids, Mich.

And that would have serious consequences for Metropolitan because the products involved make up a "substantial portion" of revenues, the lawsuit states.

Sam Botek, Jr., whose grandfather, Joseph, founded Metropolitan in 1934, was unavailable for comment. Company lawyers also couldn't be reached.

The lawsuit, which has been assigned to Judge David Katz, is among a handful of suits that distributors across Ohio have filed against MillerCoors since Aug. 29. Other suits, with similar allegations, were filed by Beverage Distributors Inc., Cleveland, and AFP Distributors Inc., Glouster.

The distributors dispute the brewery's assertion that it has the right to end distribution agreements under a provision of Ohio's alcoholic beverages franchise act allowing such terminations when a brewery is sold.

MillerCoors was established July 1 not in a sale but as a part of a joint venture between Miller Brewing owner SABMiller PLC, of London, and Molson Coors Brewing Co., Denver, the suits say. The two companies hold equal ownership stakes - and the right to end - the new operation, the lawsuit says.

Metropolitan, at 911 North Summit St. just north of downtown, has been the sole distributor of Miller products in portions of Lucas and Wood counties for years. With the formation of the new company this year, it added Coors to its beer lineup.

But in a certified letter sent to Mr. Botek's Maumee home Sept. 4, the newly formed brewer's sales vice president said that "MillerCoors is terminating your Miller Brewing Company distributor agreement and Molson distributor agreement."

The letter said the action was effective Sept. 25, 2008, but could be delayed "subject to the mutual agreement." Mr. Botek also was advised that he was losing his distributorship in St. Henry in west central Ohio.

As of yesterday, Metropolitan was still distributing the products, however.

"MillerCoors has made the consolidation of its distributor network one of its highest priorities," Tom Owston, the brewery executive, wrote in the letter to Mr. Botek. "We believe consolidation is critical in helping distributors compete more effectively and operate more efficiently in each market."

Brewery officials couldn't be reached for comment.

The suit, which seeks unspecified damages, asks the court to declare the move illegal and issue permanent injunctions barring the termination of Metropolitan's distribution agreements.

Contact Gary Pakulski at:

gpakulski@theblade.com

or 419-724-6082.