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Monsieur Touton Selection

July 31, 2006

MONSIEUR TOUTON SELECTION, LTD., PLAINTIFF,
v.
FUTURE BRANDS, LLC, THE ABSOLUT SPIRITS COMPANY, INC., AND JIM BEAM BRANDS CO., JOINTLY SEVERALLY AND INDIVIDUALLY, DEFENDANTS.



The opinion of the court was delivered by: Shira A. Scheindlin, U.S.D.J.

OPINION AND ORDER

I. INTRODUCTION

Plaintiff Monsieur Touton Selection Ltd. ("Touton"), a spirits wholesaler, brings this action against defendants Future Brands, LLC ("Future Brands"), the Absolut Spirits Company ("Absolut"), and Jim Beam Brands Co. ("Beam") (collectively, "defendants"). Plaintiff alleges that defendants have violated both federal antitrust laws and the laws of New Jersey by refusing to honor plaintiff's purchase orders for defendants' Absolut Vodka line of products, and by discriminating against Touton with regard to the terms of sale of one particular type of Absolut Vodka. All defendants now move to dismiss Touton's federal claims pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure.*fn1 For the following reasons, defendants' motion is granted, but plaintiff is granted leave to file a Second Amended Complaint.*fn2

II. BACKGROUND*fn3

A. The Parties

Touton is a New York corporation with its registered corporate offices in Willingboro, New Jersey.*fn4 It claims to be an authorized wholesaler of Absolut Vodka, one of the leading brands of vodka in the United States.*fn5 However, defendants assert, and plaintiff agrees, that "[o]f all of [Absolut's] branded vodkas, Touton was authorized to distribute only Absolut Vodka 80 proof (`Absolut Blue')."*fn6

Future Brands is a joint venture between defendants Absolut and Beam.*fn7 All three defendants are Delaware corporations.*fn8 Future Brands and Beam have their principal place of business in New Jersey, while Absolut operates from New York City.*fn9 Plaintiff also alleges the existence of "various persons not named as defendants herein [who] have participated as co-conspirators in the offense[s] hereinafter alleged, and [who] have performed acts and made statements in furtherance thereof."*fn10

B. The Alleged Misconduct

The gravamen of plaintiff's allegations is that "[o]ver the past three years, the Defendants have engaged upon [sic] a course of conduct designed to limit the Plaintiff's ability to offer the Absolut Brand."*fn11 This conduct has apparently taken many forms, "including but not limited to: disparate treatment in amount and type of product available for shipment, discriminatory pricing, failure to provide to Plaintiff pricing and other benefits offered to other similarly situated but favored entities; failure to deliver the entire range of products offered to other distributors and/or wholesalers."*fn12

More specifically, plaintiff has repeatedly had its purchase orders for Absolut Vodka rejected, ignored, or otherwise not fulfilled.*fn13 According to plaintiff, defendants have also "acted to limit the allocation of its product(s) to the Plaintiff without justification or reason."*fn14 Plaintiff also alleges that "the Defendants stated that [they] would price the products based upon the shipping date . . . not the date of acceptance of the purchase orde(s)."*fn15

According to Touton, defendant Absolut, as well as its parent corporation,*fn16 "treat[] its brand `Absolut' as a unified and singular business unit, and [have] promoted the brand `Absolut' over and above any individual type of vodka [they] may sell or offer.*fn17 But "despite its treatment of the entire line of Absolut products as unified, [defendant Absolut] has steadfastly refused to provide the Plaintiff with the entire line of Absolut brand vodka products, without reason or justification."*fn18

Out of these facts, plaintiff pleads several causes of action. The federal antitrust claims appear to consist of Counts Four, Five and Eight. Count Four, denominated as an allegation of "Unfair Business Practices," charges that "Defendants have offered promotions, commercial bribes, special deals and pricing, benefits and bonuses to the competitors of the Plaintiff, but has not offered the same to the Plaintiff, thereby creating a separate and different class of distributor."*fn19 Count Five, "Deceptive Trade Practices," alleges that "Defendants have created a program identified as the 'entity grant' program, which, upon information and belief, is administered unequally and constitutes an illegal kickback and/or subsidy scheme."*fn20 Count Eight alleges "Price Discrimination," and charges that "Defendants have conspired among themselves and others unnamed to discriminate against the Plaintiff as to price, availability, quantity and other terms so as to eliminate the Plaintiff as a competitor in the relevant market in violation of the Robinson-Patman Act."*fn21

The Complaint also sets forth an assortment of state law claims arising out of plaintiff's business dealings with defendants.*fn22 Plaintiff seeks various forms of relief, including compensatory, punitive and treble damages, an injunction compelling defendants to treat Touton the same way as they treat other wholesalers, and a declaratory judgment to essentially the same effect.*fn23

C. New Jersey Proceedings

The parties have already engaged in a protracted struggle concerning Touton's rights to distribute Absolut Vodka, which until now has taken place entirely in New Jersey.*fn24 In January 2004, Absolut petitioned the New Jersey Division of Alcoholic Beverage Control ("NJ ABC") for a declaration that it was permitted to stop selling Absolut Blue to Touton pursuant to New Jersey's Anti-Discrimination Act.*fn25 Absolut accused Touton of improperly using Absolut Blue as a loss leader to gain access to retail accounts for Touton's own inventory of wines.*fn26 Plaintiffs filed a counter-petition with NJ ABC, asserting many of the same allegations contained in the Complaint.

After ruling that Touton was not entitled to purchase the full line of Absolut-branded vodka under New Jersey law, the NJ ABC referred both parties' claims to an Administrative Law Judge ("ALJ"). On March 13, 2006, the ALJ ruled that Touton had forfeited the protections of the New Jersey Anti-Discrimination Act, a ruling which allowed Absolut to discontinue sales of Absolut Blue to Touton. Touton's cross-claims were also dismissed. Both of these rulings were the result of Touton's failure to provide discovery in the administrative law proceeding, despite repeated warnings by the ALJ that such failures would result in an adverse judgment against it.*fn27 The ALJ's rulings were affirmed by the NJ ABC on May 10, 2006. Touton now asserts, without elaboration, that the NJ ABC's decision affirming the ALJ ruling is "on appeal."*fn28

Touton also initiated an action in New Jersey Superior Court in February 2004, raising many of the state law claims raised before the NJ ABC and in the present action. The Superior Court action was swiftly dismissed under the ...


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