Anheuser-Busch Ordered to Pull In-Store Miller Attack Ads
A federal judge last week told Anheuser-Busch Cos., Inc. to pull ads from retail that target rival Miller Brewing Co. for being owned by South African breweries.
U.S. District Judge Lynn Adelman ordered the posters displayed in liquor stores pulled, but allowed two sets of TV ads Miller wanted blocked to continue. Philip Morris sold Miller to South African Brewers Plc in 2002, which formed a new company called SABMiller Plc, based in London.
Anheuser-Busch claimed that SABMiller is a South African company because a majority of its stockholders and its top three executives are South Africans.
“If you look at the shareholder, the heritage and their Web site, the facts speak for themselves,” Anheuser-Busch spokesperson Francine I. Katz, said in a statement Saturday. “Their executives might live in London, but they are a South African company.”
The judge, who watched commercials from both companies, also set a $2.5 million bond for Miller, to cover possible penalties for Anheuser-Busch’s loss of sales should the decision be reversed, according to news reports.
“We are pleased that the court found Anheuser-Busch’s advertising to be false and deceptive and ordered them to immediately remove the relevant materials from the marketplace,” Miller’s General Counsel, Mike Jones, said in a statement. “We look forward to pursuing broader issues in the normal trial process.” A date has not been set for that trial.
Miller filed the suit last Friday in the U.S. District Court for the Eastern District of Wisconsin. It wanted all of the ads blocked over the Memorial Day holiday, one of the strongest weekends for beer sales.
Anheuser-Busch said that the court ruled that it was free to say “Miller was purchased by South African Breweries” and that “Miller is South African-owned,” but had to refrain from saying, “Miller is owned by South African Breweries.”
“That phrase appeared only in a limited number of retail marketing materials and will be easily pulled,” Katz said.
The TV ads feature the Budweiser Clydesdales and donkey along with the swamp creatures, lizards Frank and Louie, which discuss Miller’s ownership.
The court also set a date of June 29 to review another new Anheuser-Busch campaign that refers to Miller Lite as the “Queen of Carbs.”
Anheuser-Busch, which brews Budweiser and Bud Light and is based in St. Louis, MO, is the world’s largest brewer with 50% of the U.S. beer market last year. Miller, the world’s second-largest brewer by volume, also based in Milwaukee, had 18%. The two companies have been battling for market share and have become increasingly aggressive in using attack ads to win consumers as the busy summer season gets underway, including both sides calling the other un-American.
The judge also heard arguments that Anheuser-Busch has stickered Miller Lite products with Bud Light logos that read, “All light beers are low in carbs. Choose on taste.” Anheuser-Busch denied any wrongdoing but agreed to send a memo to all distributors reminding them that stickering or defacing competitor’s products is illegal, the reports said.
In a separate development, Anheuser-Busch has bid about $720 million for China’s fourth-largest brewer, Harbin Brewery Group Ltd. topping SABMiller’s hostile $550 million offer. In May, Anheuser-Busch acquired 29% of the Chinese beer maker for $139 million.
