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Court rules that liquor distributor was wrongfully terminated

| Jul 1, 2013 | Wrongful Termination |

In late June, a St. Louis Circuit Court ruled in favor of a St. Louis-based liquor distributor in a wrongful termination lawsuit against a supplier. This is one of multiple claims associated with an ongoing battle surrounding the Missouri Franchise Law, a fight which is being referred to as the “liquor wars.” The Court ruled that the distributor’s relationship with the supplier was a franchise relationship and that the distributor was a victim of wrongful termination. Citing a section of the Missouri Franchise Law that has been much criticized during the course of the litigation, the Court held that a “community of interest” existed between the supplier and distributor.

The distributor will suffer losses accounting for 23 percent of its revenues when it stops selling the supplier’s brands on July 1. According to court documents, the distributor regularly failed to meet goals set by the supplier, but it was only after a recent federal court of appeals decision and a lucrative offer by another distributor that the supplier decided to terminate the existing distributorship. A countersuit was filed against the competing distributor alleging interference in the existing agreement, but no ruling was made on the countersuit. The Court ultimately concluded that the supplier’s issues with the distributor was not a factor in the termination of the business relationship, and cites unreliable testimony by the supplier’s executive during the hearing of the matter by the Court. A case management conference in the case is scheduled for August.

Employment laws are designed to protect the rights of employees. Employees who are victims of wrongful termination may seek legal remedies through the court system. Specific protections afforded to employees under these laws provide avenues for employees to seek relief when facing unfair treatment in the workplace.

Source: The Missouri Times, “Court ruling issued in Major Brands termination suit with Diago“, Ashley Jost, June 26, 2013

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