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LOUIS GLUNZ BEER, INC. v. MARTLET IMPORTING CO.

September 28, 1994

LOUIS GLUNZ BEER, INC., WAUKEGAN JACK DONELSON SALES CO., B.B. DISTRIBUTORS, INC., GRANT IMPORTING AND DISTRIBUTING, SOUTHWEST BEER DISTRIBUTORS, SCHAMBERGER BROTHERS, INC., RADAKOVICH LIQUOR & BEVERAGE CO., BROWNSTONE BEVERAGE CO., and HARTMAN BEVERAGE CO., Plaintiffs,
v.
MARTLET IMPORTING COMPANY, INC., MILSON BREWERIES U.S.A., INC. and MILLER BREWING CO., INC., Defendants.



The opinion of the court was delivered by: MARVIN E. ASPEN

 MARVIN E. ASPEN, District Judge:

 Plaintiffs Louis Glunz Beer, Inc., Waukegan Jack Donelson Sales Co., B.B. Distributors, Inc., Grant Importing & Distributing, Southwest Beer Distributors, Schamberger Brothers, Inc., Radakovich Liquor & Beverage Co., Brownstone Beverage, Co., and Hartman Beverage, Co. bring this six-count complaint against Martlet Importing Co., Inc., Molson Breweries U.S.A., Inc., and Miller Brewing Co., Inc., seeking injunctive relief, compensatory damages, and punitive damages. Presently before the court is defendants' motion to dismiss plaintiffs' complaint. *fn1" For the reasons set forth below, the motion is granted in part and denied in part.

 I. Background

 Defendant Martlet Importing Company, Inc. ("Martlet") is a division of defendant Molson Breweries U.S.A., Inc. ("Molson U.S.A."), which in turn is a subsidiary of defendant Miller Brewing Company, Inc. ("Miller"). Miller owns the rights to market all products produced under the "Molson" brand and trademark in the United States, pursuant to a licensing agreement with the Molson Companies, Ltd. the Canadian company which manufactures Molson products. *fn2"

 In 1979, Martlet appointed plaintiff Louis Glunz Beer, Inc. ("Glunz") as the master distributor for all Molson products in Illinois. In this role, Glunz appointed, with Martlet's approval, other beer wholesalers to act as sub-distributors for these products. Some of the plaintiffs in this action were among this original group of sub-distributors, while others became sub-distributors in subsequent years. In 1986, Glunz's role as master distributor was terminated. Instead, Martlet began to deal directly with the former subdistributors. And although its role as master distributor was eliminated, Glunz retained the right to serve as the exclusive distributor in the territory it had been assigned. *fn3"

 In January, 1993, Molson Companies announced that it had sold Molson U.S.A. to Miller. This purchase was announced to plaintiffs in a letter from Molson U.S.A. president John Barnett which read in part:

 
Molson Breweries USA will continue to operate as a stand-alone business - selling, marketing and distributing in the United States, and we plan to continue business as usual with our distributors and customers.

 Later that year, in July, 1993, Martlet advised plaintiffs that the Molson brewery planned to introduce a new product called "Molson Ice," and that this new product would be distributed by plaintiffs along with the other Molson products they already handled. A few months later, Martlet sent registration statements to the Illinois Liquor Control Commission designating plaintiffs to be the authorized distributors of Molson Ice in their respective territories, as Martlet had routinely done in the past when introducing new products in the Chicago area.

 In October 1993, however, each plaintiff received from Martlet a document entitled "Settlement of Claims and Release," which purported to be in response to each plaintiff's offer to terminate its relationship with Martlet, although none of the plaintiffs had, in fact, made such an offer to Martlet. At this same time, plaintiffs heard rumors that Miller intended to transfer distribution of all Molson products from plaintiffs to Miller's own distributor network, and that Miller had promised Miller distributors the distribution rights for Molson Ice. Nonetheless, in early November, 1993, upon a request from the Illinois Liquor Control Commission, Martlet resubmitted registration statements for Molson Ice, which again designated plaintiffs as the Molson Ice distributors in their respective territories.

 On November 4, 1993, counsel for defendants and plaintiffs agreed to meet on November 19, 1993. In the interim, on November 12, 1993, counsel for defendants advised counsel for plaintiffs that Miller was appointing Doyle Distributing Co., Inc., a Miller distributor, to distribute Molson Ice in Lake County, Illinois. *fn4" At the November 19 meeting, however, defendants advised the remaining plaintiffs that they had not yet made a decision regarding Molson Ice distribution for the metro Chicago market.

 Less than a month later, on December 15, 1993, three Chicago metro area Miller distributors began, at the direction of defendants, marketing Molson Ice in the geographic area for which Glunz had previously been exclusively responsible. *fn5" On that same day, Glunz received a letter from Martlet advising it that Glunz' distributorship for all Molson products was terminated, effective March 31, 1994. The letter offered no reason for the termination.

 With respect to the remainder of the plaintiffs, Martlet refrained from providing furnishing them with materials for a midwestern promotion campaign, advising one of the plaintiffs that "under the circumstances" plaintiffs would not be allowed to participate. In addition, Martlet failed to offer price support for the first quarter of 1994, and cancelled several price promotions it had planned for November and December. *fn6" Furthermore, Osco Drug Store, one of plaintiffs' most significant customers, did not schedule any December, 1993 promotions for Molson products, contrary to its usual practice. ...


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