Beam Suntory Says Tim Hassett Suit Relies on “Made-Up Allegation”

Dear Client:  

Earlier this year, Tim Hassett, the former head of Beam Suntory’s Americas region, filed suit against Beam Suntory for alleged breach of contract for “failure and refusal to pay certain compensation,” per court documents [see WSD 03-18-2019].

On Monday, Beam Suntory filed a motion to dismiss the suit and the company didn’t pull any punches.

BACKGROUND. Tim joined Beam Suntory in 2014 as the president of its North America business. Under the terms of his employment agreement, his compensation included but was not limited to: a base salary of $500,000, participation in the company’s Executive Incentive Plan (EIP) bonus program–also called the Annual Incentive Plan (AIP)–and an annual Long Term Incentive (LTI) award, per court documents.

As Tim tells it, he was offered a position with another company in October 2017, but he didn’t want to accept the position immediately if it meant giving up that hefty award and bonus. He claims that Beam chief Matt Shattock “promised” that Tim “would be entitled to either all or a portion of his” 2017 bonuses if Tim agreed to stay on to assist with the transition to Tim’s replacement, per court documents.

He is seeking damages in the amount of $1.85 million (the LTI + bonus) plus interest and attorneys’ fees.

BEAM SUNTORY’S SIDE OF THE STORY. Beam Suntory claims the complaint relies on the “made-up allegation” that Matt “orally promised Hassett an indeterminate sum of up to $1.85 million,” per the motion to dismiss.

Per the LTI and bonus programs, Tim had to remain in his role through December 31, 2017 to receive the compensation, which Beam notes that Tim concedes, and that “admission is thus fatal to any claims based on these written agreements.” Recall, Tim left Beam in November 2017 and was replaced by Albert Baladi [see WSD 11-02-2017].

Moreover, Beam argues the alleged oral agreement with Matt lacks the details to constitute a contract or agreement, such as the exact amount of compensation, what services Tim performed, if he performed them etc. “Likely because such an assertion is entirely fabricated, the complaint’s allegations in this regard are noticeably vague, ambiguous, evasive, internally inconsistent, and conspicuous in their omissions,” per the motion.

As such, Beam claims Tim’s complaint fails at the pleading stage and should be dismissed with prejudice.

INVESTMENT GROUP BUYS DOMAINE SELECT

Domaine Select Wine & Spirits has been sold to an investment group led by industry veteran Hill Flynn, who will be the new DSWS president. Terms of the deal were not disclosed.

DSWS founder Allison Domeneghetti is staying on as president of Domaine Select Merchants, the company’s New York wholesale subsidiary. Current evp Robert Falvo will also remain on board and continue to run the company’s national business.

DSWS “is once again on a firm financial footing and the changes have been embraced by our suppliers,” says Hill in a statement. “There is a tremendous amount of excitement among all of our stakeholders.”

DSWS was founded in 1999 and began as an importer of Italian wines. The company now represents wineries from around the world as well as craft spirits such as Atlantico Rum, Nobushi Whiskey and Catskill whiskies.

OKLAHOMA GOV. SIGNS BILL CHANGING UP ALCOHOL DISTRIBUTION LAWS

On Monday, Oklahoma Gov. Kevin Stitt signed a bill (SB 608) changing up the state’s alcohol distribution laws, requiring the top 25 wine and spirits suppliers to offer their products to all wholesalers.

The new law goes against the distribution rules introduced in State Question 792–enacted just seven months ago–which allowed suppliers to choose any wholesaler in the state.  

Sen. Stephanie Bice said the bill goes against the will of the people, calling it misguided, not well thought out, bad form and bad policy during a Senate discussion, reports the Journal Record.

The bill is expected to face legal challenge, most likely from a wholesaler or supplier (or both), according to John Maisch, president of the Institute for Responsible Alcohol Policy.

WSD BRIEFS:

WILLIAM GRANT & SONS NAMES NEW CFO. William Grant & Sons has appointed Helen Cowing as its new group cfo, per The Scotsman. Most recently, she held a similar position at financial services and energy group Octopus. She’s also worked at PepsiCo, Novartis, AP Moeller and Nestle, among others. “Helen’s impressive leadership of global businesses, her international financial expertise and her commitment to values-based leadership in developing high performing teams, will make her a great addition to the executive board and the wider business,” says chief executive Simon Hunt.

WINEBOW APPOINTS NEW GM, CA. Winebow has named Scott Edwards as gm, California. Scott most recently worked at Foley Family Wines as coo and evp of sales, and before that he held positions at Treasury Wine Estates, Beringer Wine Estates and Forman Brothers. In his new role, he will report to evp, wholesale west Erle Martin. “His extensive and varied experience in the business, coupled with his far-reaching market knowledge, will be an enormous asset. I am delighted to bring his talent and resources to our organization,” says Erle.

BROCKMANS GIN EXPANDS US DISTRIBUTION. Brockmans Gin is expanding its distribution footprint to also include FL, GA, TN, IL, MI, MO and CO. The company has appointed RNDC to handle its distribution in FL, MI and CO; National Distributing Co. in Georgia; Athens Distributing Co. in Tennessee; Breakthru Beverage in Illinois; and Major Brands in Missouri. In addition, Brockmans also appointed Blue Ridge Spirits & Wine Marketing as its national sales and marketing partner.

WILLAMETTE VALLEY VINEYARDS UP 10% IN Q1. Willamette Valley Vineyards reported a 10.3% increase in revenues for the first quarter of 2019. Direct sales were up more than $170,000 for the quarter and sales through distributors were up nearly $297,000. “We are very pleased to start strong in 2019,” says founder and president Jim Bernau. “We hope to continue this momentum while we develop our Bernau Estate winery in Dundee, Oregon.”

Until tomorrow,
Sarah

“If you don’t like something, change it. If you can’t change it, change your attitude.” – Maya Angelou

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