Esber Beverage Co. v. Labatt USA Operating Co., LLC
Annotate this CaseA manufacturer or alcoholic beverages (InBev) sold all of its rights relating to a particular brand of alcoholic beverage to a successor manufacturer (Labatt Operating). Under the Ohio Alcoholic Beverages Franchise Act, when there is a transfer of ownership, the successor manufacturer may terminate any distributor's franchise without just cause by giving the distributor notice of termination within ninety days of the acquisition and compensating the terminated franchisee. Appellant in this case was the exclusive distributor of Labatt brand products in a ten-county area of Ohio under a franchise agreement with InBev. After the sale, Labatt Operating notified Appellant that it intended to terminate Appellant's franchise to distribute Labatt brand products and that it intended to compensate Appellant. Appellant sued. The trial court granted summary judgment for Appellant and ordered Labatt Operating to continue to distribute its Labatt products through Appellant. The court of appeals reversed. The Supreme Court affirmed, holding that Labatt's termination of Appellant's franchise met the statutory requirements of the Act, and therefore, the court of appeals erred in granting summary judgment to Appellant.
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