(Scottsdale, AZ) – Four Peaks Brewing Company filed a lawsuit earlier this month in order to rid itself of its only in-state distributor, Alliance Beverage Distributing, and enable it to proceed with a new distributor.
The brewery has sent this note out to trade partners:
As you may have heard, we have begun the process of changing distributors. We are simply doing what’s best for Four Peaks, our employees, our customers and you. Though our lawyers have asked us to say as little as possible, we need you to know that for the time being, it’s business as usual for Four Peaks. We will continue to produce the great beer you have come to know and love, and until further notice, distribution will remain as it has been. Certainly, we are hopeful there will be a swift and seamless transition to a new distributor in the very near future.
That process begins with outlining to Superior Court Judge, George Foster, how Alliance Beverage wronged the company.
Among the several complaints that Four Peaks lists, according to the court filing, are, “Alliance has failed properly to maintain the quality of Four Peaks’ products through the distribution cycle” and “Alliance has provided ‘out of code’ product to retail resellers of Four Peaks’ product.”
In Arizona, a supplier can terminate a commercial agreement (one that establishes a “franchise” or contract between the two parties) with a wholesaler “in good faith and with good cause” according to the state’s statutes.
This case is unique because Four Peaks is alleging that the two companies never established a valid franchise. Four Peaks says that the relationship doesn’t meet any of the three criteria for a franchise as set forth by the statutes.
Moreover, Four Peaks says that, even if the court decides that it is a valid franchise, that the company would still be terminating such a relationship “in good faith and with good cause” due to Alliance’s alleged wrongdoing.
Four Peaks already has an agreement in place with Hensley Distributing that would go into effect once the dispute with Alliance is resolved. Four Peaks has conceded that it would provide fair market value for the franchise to Alliance in order to move forward with Hensley though the filing states that Alliance would “reject this offer.”
According to a Four Peaks spokesperson, Alliance was granted an extension this week to file a response to the complaint until July 17th.
Four Peaks Brewing was founded in 1996 and production grew 57% to 36,000 barrels of beer last year, according to The Brewers Association.
This may mean that Tucson gets some Pumpkin Porter this year. The Hop Knot is always hard to find and out of date! Good choice FP!
Come on Hensley, all you need to do is pony up $25 million or so and this lawsuit would go away. McCain can afford it.
Alliance has helped build the Four Peaks brand from day one and sells every bit of beer they can make in state. Now that the brewery is getting ready to double capacity Hensley is looking to capitalize on what Alliance helped build. Pay them McCain.
‘Out of Code’ beer from the crappy distribution network in Arizona is sadly the norm. I have many friends that own bars or run bottle shops and the amount of stuff they order that fits into the follow is shocking.
#1: The wrong product from the right producer
#2: Very very old product (a 2 year old case of Alesmith Yulesmith you told me was fresh? Wow you are so generous!)
#3: Keg beer with significant defects, probably related to the above.
#4: The exact same thing that they previously returned for the above reasons.
Alliance, Golden Eagle, Hensley, Little Guy/Finley/Crescent Crown/World Class have pretty much all been guilty of the above. Buyers regard all of them as pretty much the same, which is to say pretty close to worthless. I would almost accuse one of the big three brewers trying to ruin the craft beer scene with bad distributors but I know better.
Good on ya Four Peaks, maybe if enough of the distributors find out they suck at what they are doing and lose customers they will make the necessary cultural changes to fix things.
I’m not holding my breath
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