GModelo files lawsuit against Constellation Brands

16 December, 2009

Constellation Brands has announced that it is aware of a lawsuit filed on Tuesday December 15, 2009 in New York federal court by GModelo, a subsidiary of Grupo Modelo.

But the wine giant said it has not been formally served with the lawsuit and has said the 'claims lack merit'.

Constellation said in a statement: “Constellation and GModelo are partners in Crown Imports LLC, a 50/50 joint venture which commenced in January 2007. Crown’s board of directors is comprised of four directors from each parent company. The initial term of the joint venture extends through the calendar year of 2016.

“At issue is the funding by the partners for incremental Crown promotion and marketing spending for calendar year 2010.  Previously, the incremental spending in question was provided by GModelo and was agreed upon once again for the 2010 business plan. The funding at issue is not material to Constellation’s overall financial position. Constellation believes that the claims lack merit and will defend its position.

“Crown is not a party to this lawsuit and Constellation believes that Crown remains fully engaged in executing against the plan for calendar year 2010 and growing its business through the entire initial term of the contract.”

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