Pro Baseball Countersues Anheuser-Busch
(CN) - Major League Baseball claims Anheuser-Busch breached its sponsorship agreement by cutting another deal with the National Football League. Major League Baseball countersued the beer giant after Anheuser-Busch sued it November. Many industry watchers believe Anheuser-Busch is paying the NFL more than it pays pro baseball.
Both Anheuser-Busch's complaint and Major League Baseball's Answer, Affirmative Defenses, and Counterclaim were filed in Manhattan Federal Court.
In the original complaint, Anheuser-Busch asked a judge to force Major League Baseball to adhere to the terms of a sponsorship agreement the beer giant struck with MLB in April.
MLB says it backed out of that agreement because Anheuser-Busch did not disclose that it was about to sign a sponsorship deal with the NFL.
MLB says Anheuser-Busch promised that MLB would be its No. 1 sports property in the United States, but the scope of its agreement with the NFL makes that impossible.
"Following announcement of A-B's deal with NFL, MLBP continued to negotiate in good faith with A-B regarding a potential Promotional Rights Agreement between the parties for 2011 and beyond," Major League Baseball says in its counterclaim. "However, these discussions were not fruitful because A-B refused to fulfill its promise to MLBP to make MLBP A-B's top, number one sports property in the U.S."
MLB claims its April agreement was fraudulently induced, since Anheuser-Busch announced its deal with the NFL just 7 days later.
That deal makes Bud Light the official beer of the NFL beginning in 2011. The terms of the deal remain private, but it is believed to be worth between $50 million and $200 million.
Many analysts believe Anheuser-Busch paid substantially more for the NFL rights than it did Major League Baseball.
MLB also claims Anheuser-Busch has intimidated other beer companies from negotiating with Major League Baseball for a sponsorship agreement.
"Specifically, on October 8, 2010, A-B issued letters to five separate companies threatening them with legal action if they were to negotiate with MLBP regarding any promotional rights agreement and suggesting that MLBP was acting unlawfully in offering its promotional rights to market," the new complaint states.
"A-B's actions in threatening malt beverage companies and suggesting that MLBP is acting unlawfully or unethically has devalued MLBP's brand in the market and harmed MLBP's reputation and goodwill."
A federal judge has scheduled an initial hearing for Jan. 7.