Pabst Blue Ribbon may be on the brink of death if a lawsuit against MillerCoors doesn’t go their way.
Hipsters around the world should be quaking in their high top boots at the news that their most beloved brew, Pabst Blue Ribbon, may not be long for this world.
An ongoing legal dispute between Pabst and brewer MillerCoors is set for a legal showdown that could decide the fate of Pabst as an ongoing concern. Pabst needs MillerCoors to brew its products, but MillerCoors has made it clear that it no longer wants to help out Pabst by brewing their lineup.
You might be wondering why two competing brewers would be in this sort of entanglement. MillerCoors, as with some other large brewers, contracts out excess brewing capacity to make an extra buck. This prevents them from having to close down factories when business is slow, and it helps other companies expand their business. Win/win, as they say.
Pabst and MillerCoors signed their agreement in 1999 which runs until the year 2020, at which point there a provision for a contract extension if the companies agree to it. MillerCoors has already said it has no intention of renewing the contract, but Pabst argues that the contract states MillerCoors must “act in good faith”, according to the Washington Post, in order to come to an equitable solution.
And it’s become clear that MillerCoors has no interest in acting in good faith. During an earlier hearing last March, Pabst uncovered documents that showed MillerCoors hired a consultant to see how they could extract themselves from Pabst while also putting them under. They closed down two large breweries and then told Pabst that they no longer had the capacity to continue brewing their product.
When Pabst asked to lease a factory that MillerCoors planned to shut down, they made an offer that was three times the going rate for a facility rental.
For Pabst, this is an existential problem. MillerCoors facilities were making, packaging, and shipping their products. Without them, they’re not selling much of anything from their lineup of Pabst Blue Ribbon, Old Milwaukee, Natty Boh, and Lone Star.
The trial began Monday and is expected to run until November 30th. Depending on how the judge rules, we might see the end of Pabst for good.