Diddy-owned beverage company sues Diageo alleging racial discrimination

A drinks company owned by Sean Combs, known as Diddy, has sued Diageo for alleged racial discrimination, arguing that the global conglomerate did not invest enough in brands linked to the rapper. Is.

In court documents filed in New York state court in Manhattan, the musician’s company Combs Wines & Spirits said: “Diageo has treated Mr. Combs and his brands worse than others because he is black.”

The Delion tequila brand, co-owned by the two conglomerates, and Diageo’s Ciroc vodka brand, in which it collaborates with Combs, have been “typecasted” and regarded as “black brands”, according to legal guidelines. Should be targeted at “urban” consumers. Dress.

Diageo characterized the groups’ differences as a “commercial dispute” and said that “we are sorry that Mr Combs has chosen to treat this matter as something other than this”.

It said it categorically denied the allegations, “will vigorously defend itself” and had a “firm commitment to diversity”.

But Combs Wine & Spirits said its beverage brands were “starved” of production, distribution and sales resources at the expense of others, such as Casamigos Tequila. Hollywood actor George Clooney sold that brand to Diageo in 2017 for up to $1 billion.

Legal documents say Diageo executive Stephen Rust told Combs, formerly known as P Diddy and Puff Daddy, in late 2019 that “if she were Martha Stewart her brands would be more widespread”.

The US rapper-turned-business mogul teamed up with Diageo to buy Delion Tequila in 2014. This was followed by the success of the groups’ joint marketing and profit-sharing deal for Diageo’s fast-growing Ciroc vodka, for which Combs is creative director.

Combs’ company said Don Julio, Diageo’s wholly owned tequila brand, is distributed in 36 percent of US outlets while Casamigos is in 34 percent. DeLeon is present in only 3 percent of US outlets.

Combs Wines said it was left with “no choice” but to seek legal recourse to secure “the same treatment (Diageo) gives other, successful tequila brands”.

Celebrity-endorsed booze has proliferated in recent years and Diageo, the world’s biggest spirits-maker, has been quick to take ownership of such brands.

In 2014 the group partnered with footballer David Beckham to launch the Scotch Whiskey Haig Club. It also bought the gin brand co-owned by actor Ryan Reynolds in a $610 million deal in 2020.

In 2022, tequila was the fastest-growing spirit in the US, with Americans spending more than $13.3 billion on agave spirits – a category that also includes mezcal – a larger total than that spent on US-made whiskey. According to research group IWSR, such drinks are set to overtake vodka as America’s top-selling liquor in 2023.

According to RBC Capital Markets, tequila has been a profit driver for Diageo, accounting for more than half of the group’s growth since 2018, adjusting for currency fluctuations.

A drinks company owned by Sean Combs, known as Diddy, has sued Diageo for alleged racial discrimination, arguing that the global conglomerate did not invest enough in brands linked to the rapper. Is.

In court documents filed in New York state court in Manhattan, the musician’s company Combs Wines & Spirits said: “Diageo has treated Mr. Combs and his brands worse than others because he is black.”

The Delion tequila brand, co-owned by the two conglomerates, and Diageo’s Ciroc vodka brand, in which it collaborates with Combs, have been “typecasted” and regarded as “black brands”, according to legal guidelines. Should be targeted at “urban” consumers. Dress.

Diageo characterized the groups’ differences as a “commercial dispute” and said that “we are sorry that Mr Combs has chosen to treat this matter as something other than this”.

It said it categorically denied the allegations, “will vigorously defend itself” and had a “firm commitment to diversity”.

But Combs Wine & Spirits said its beverage brands were “starved” of production, distribution and sales resources at the expense of others, such as Casamigos Tequila. Hollywood actor George Clooney sold that brand to Diageo in 2017 for up to $1 billion.

Legal documents say Diageo executive Stephen Rust told Combs, formerly known as P Diddy and Puff Daddy, in late 2019 that “if she were Martha Stewart her brands would be more widespread”.

The US rapper-turned-business mogul teamed up with Diageo to buy Delion Tequila in 2014. This was followed by the success of the groups’ joint marketing and profit-sharing deal for Diageo’s fast-growing Ciroc vodka, for which Combs is creative director.

Combs’ company said Don Julio, Diageo’s wholly owned tequila brand, is distributed in 36 percent of US outlets while Casamigos is in 34 percent. DeLeon is present in only 3 percent of US outlets.

Combs Wines said it was left with “no choice” but to seek legal recourse to secure “the same treatment (Diageo) gives other, successful tequila brands”.

Celebrity-endorsed booze has proliferated in recent years and Diageo, the world’s biggest spirits-maker, has been quick to take ownership of such brands.

In 2014 the group partnered with footballer David Beckham to launch the Scotch Whiskey Haig Club. It also bought the gin brand co-owned by actor Ryan Reynolds in a $610 million deal in 2020.

In 2022, tequila was the fastest-growing spirit in the US, with Americans spending more than $13.3 billion on agave spirits – a category that also includes mezcal – a larger total than that spent on US-made whiskey. According to research group IWSR, such drinks are set to overtake vodka as America’s top-selling liquor in 2023.

According to RBC Capital Markets, tequila has been a profit driver for Diageo, accounting for more than half of the group’s growth since 2018, adjusting for currency fluctuations.