Lawsuit between Pabst and MillerCoors could spell the end of Pabst Blue Ribbon

LOS ANGELES, CA - MAY 21: General atmosphere of the beverage "Pabst Blue Ribbon" at the Burton & Channel Islands store on May 21, 2015 in Los Angeles, California. (Photo by Rochelle Brodin Photography/Getty Images)

The future of Pabst Blue Ribbon beer could be up in the air, thanks to a brewing legal battle between Pabst and MillerCoors, NBC News reported.

The two brewing companies were in court Monday to argue a case that could make or break the popular beer brand’s future.

For the last two decades, MillerCoors has been brewing Pabst’s legacy beers, which includes Pabst Blue Ribbon, Old Milwaukee, Lone Star, and Natty Boh. The companies signed an agreement in 1999 that is set to expire in 2020, with two options to renew. If the two companies cannot agree on a renewal, Pabst would likely have to cease production of many of its famous brands.

MillerCoors claims that it is not obligated to renew the deal, and points to diminished brewing capacity as a compelling reason to back out. Pabst argues that MillerCoors is trying to drive the competition out of business.

The trail, which gets underway in Milwaukee County Court this week, is expected to last until the end of the month. Pabst is suing for more than $400 million in damages, and is asking for MillerCoors to work “in good faith” to help find a solution — even if the company no longer has the capacity to continue brewing the legacy beers.

NBC says MillerCoors closed a 1.3 million-square-foot brewery in Eden, North Carolina, which had the capacity to brew more than 8.8 million barrels of beer per year.

MillerCoors is mulling the closure of another brewery in California, this one with a 6 million barrel-per-year capacity. If that happens, MillerCoors would be down to six breweries nationwide.

Pabst says it needs anywhere from 4 million to 4.5 million barrels every year.

In a statement on Monday, Pabst alleged MillerCoors “willfully breached our 19-year agreement in an effort to stomp out the competition,” NBC News reports. “Even though MillerCoors’ market power is much larger than Pabst’s, we will not allow this industry bully to push us around. We are confident that the court will see MillerCoors’ fabricated ‘capacity’ concerns for what they are: a thinly veiled, bad faith attempt to unlawfully hurt a competitor.”

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