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Sean ‘Diddy’ Combs accuses Diageo of “illegal retaliation” as dispute continues
FoodBev Media

FoodBev Media

20 July 2023

Sean ‘Diddy’ Combs accuses Diageo of “illegal retaliation” as dispute continues

The dispute between Sean ‘Diddy’ Combs and Diageo has deepened further with the release of a court filing in which Combs accused the drinks giant of “illegal retaliation”. Diageo announced that it was terminating its business relationship with Combs at the end of June after the musician filed a lawsuit against the company, alleging that his brands had been treated “worse than others” because of his race and marketed only to “urban consumers”. The company filed a motion to dismiss the case and announced that it would sever ties with Combs while formally responding, claiming that Combs’ complaints were “baseless” and that his actions had breached his contracts. Now, in a brief filed to the New York Supreme Court and made public on 19 July, Combs and his attorney have described Diageo’s termination of their relationship for both the DeLeón Tequila and Cîroc Vodka brands as an “illegal and outrageous retaliation”. The filing stated: “The message is clear – if you dare to shed light on Diageo’s conduct, you will be punished”. It went on to describe how Diageo did not uphold its commitments to support the DeLeón Tequila joint venture, failing to “allocate sufficient production support” to the brand and responding to Combs’ repeated raising of the issue with “false assurances and no curative actions”. “Diageo terminated the Cîroc relationship not because of meritorious allegations of breach, but because it wanted to retaliate against and punish Mr Combs for daring to assert Combs Wines’ legal rights,” the filing continued. The spirits conglomerate has allegedly blocked Combs from delivering a planned speech at a distributor event and issued directives to stop Combs Wines, which co-owns DeLeón with Diageo, from speaking with distributors and retailers about the brand. The filing asserted that everything Combs had done in filing his lawsuit was “in strict accordance with all Diageo agreements”. It stated that under his DeLeón JV agreement, Combs had satisfied all obligations. In his lawsuit, Combs asked the court for injunctive relief to enforce an “equal treatment” agreement. The filing includes a letter Combs’ attorney John Hueston sent to Diageo’s attorney, demanding that the company end its “plainly retaliatory and unlawful conduct”. Hueston stated that the company had “absolutely no legal basis” to claim that Combs had breached any contracts to end the DeLeón and Cîroc relationships. He noted that under New York State law there is an “absolute litigation privilege” that allows him to raise the issues in a lawsuit, protecting his right of access to the courts. He also pointed out that Combs had “gone to great lengths to avoid revealing confidential information” by redacting more than 2,500 words from the original complaint, which a judge later determined could “virtually all” be unsealed. Allegations of discriminatory behaviour from Diageo include presenting Combs with a watermelon-flavoured DeLeón despite Combs’ objections and “efforts to educate Diageo about the racial history and connotations relating to watermelon”. The company also was alleged to have withheld agave for DeLeón while allocating it to other brands, encountered paperwork issues resulting in a shipment of the tequila being impounded by Mexican authorities, and experienced “inconsistent production” leading to frequent shortages of the product including being out of stock at least ten times in the past year. In response to the accusations, a Diageo spokesperson told FoodBev: "This is a business dispute and should not be recast as anything other than that". "We have exercised our contractual rights to terminate the marketing services agreement in place for Cîroc and begin the wind down of the DeLeón joint venture. Our actions are consistent with our desire to protect the significant investment we have made in both brands and their future growth." The spokesperson added: "Mr. Combs’ longstanding bad faith actions, false accusations, and breaches of contract overwhelmingly support Diageo’s justified decision to sever ties."

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