Alcohol Justice Asks California AG Xavier Becerra to Investigate Anticompetitive Anheuser-Busch InBev Takeover of Ace Beverage LLC

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Foreign-Owned Mega-Brewer Is Monopolizing US Beer Distribution Networks

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Dec 15, 2020, 15:00 ET

SAN FRANCISCO, Dec. 15, 2020 /PRNewswire/ -- Alcohol Justice sent a letter to California Attorney General Xavier Becerra requesting a full-scale investigation of recent actions in the state by Anheuser-Busch InBev (ABI). Alcohol Justice believes ABI is in violation of California's Cartwright Act and federal antitrust statutes, case law, and a 2018 federal court consent agreement.

"Anheuser-Busch InBev is not content with its global, national and state dominance of beer manufacturing and is now seeking anticompetitive market power in California by buying up distributors like Ace Beverage LLC of Los Angeles," stated Bruce Lee Livingston, Executive Director/CEO of Alcohol Justice. "Alcohol Justice has asked for a full-scale investigation by California AG Xavier Becerra of anticompetitive and unfair trade practices by ABI, led by their out-going CEO Carlos Brito."

Alcohol Justice's letter to Becerra outlines in detail its concerns, including:

"The monopoly power potential of ABI in California is already great. With significant control in the distribution network as well, ABI can:

Potentially get inside information on retail activity at nearly every store, on-sale ABC licensee, or small producer.
Lower and raise beer prices at will.
Offer generous promotions and swag to retail tier purchasers to force out competitive brands.
Make it difficult for craft brew producers to get onto their trucks, while under lock-down conditions the craft brew industry is already suffering great economic stress.
Diminish distribution market share for any remaining independent distributors, forcing them out of business or forcing them to sell their assets and routes to ABI at deep discounts."

Alcohol Justice Board President Richard Zaldivar, the founder of The Wall – Las Memorias (a community-based health prevention non-profit), said, "The diverse population of Los Angeles is already suffering from the COVID-19 pandemic and does not need cheap beer products in our neighborhoods or struggling mom and pop small business retailers under the thumb of a global corporation like Anheuser-Busch InBev. The middle tier of beer distribution in Los Angeles needs protection from unfair business practices."

The Alcohol Justice letter offers the possibility that ABI's recent acquisitions in the state and its dramatically expanded market position could violate the spirit, if not the actual letter, of the October 2018 US District Court for the District of Columbia final judgement and order. By agreeing to that consent decree, ABI was allowed to purchase the world's second major beer producer, SAB Miller-Coors. The court-approved settlement decree is supposedly monitored by the federal government to prevent over-concentration and undue influence by the behemoth manufacturer.

"Alcohol Justice believes that California's antitrust law – the Cartwright Act, other statutes and case law – are relevant and being violated," added Livingston. "And therefore, it is appropriate for Attorney General Becerra to investigate and prosecute, even if a federal response does not occur from the Department of Justice."