1st BATCH OF FILES AVAILABLE NOW!

A second distributor that received a sweeping subpoena from Southern Glazer's Wine & Spirits last Aug refused to cooperate and landed in court this mo. Last wk, Southern filed a motion in a Texas fed ct to compel cooperation with the request from Favorite Brands, wine, spirits and craft beer-focused sibling co of major TX-based AB distrib L&F, owned by the LaMantia family. The filing follows a near identical dispute between Southern and Hensley in nearby Arizona, which landed in fed ct last mo (a story we broke earlier this mo). Recall, Southern subpoenaed 11 distribs, including top players in 5 states (AZ, CA, IL, TX, WA), seeking essentially all of their pricing strategy and transaction data with both retailers and suppliers, going back 6 yrs. On Dec 4, just 2 days after Southern filed its motion in AZ, the co's outside counsel shared that filing with Favorite Brands' attys and confirmed that "SGWS is moving to compel against distributors that do not produce documents." So how many others are resisting? And how many similar disputes will end up in court, further complicating the FTC's first major price discrimination case in 2+ decades?"Almost Half" of Transactions ID'd by FTC in TX, SGWS Sez in Similar Filing Turns out Texas is a major focus for the FTC's case against SGWS, the distrib wrote in its filing against Favorite Brands. Out of the over 17 million transactions that the agency claims demonstrate Southern's discriminatory pricing, "almost half of these&mdash;around 8 million&mdash;are in Texas," the co explains. Then again, FTC could still add to that list.Broadly, Southern's new filing closely tracks its earlier motion against Hensley. Much of it copies and pastes precise language about the underlying dispute with FTC and SGWS's arguments that its requests are "relevant to SGWS's defenses, not unduly burdensome, and proportional to the needs of the case." References to earlier cases and necessary citations shifted, but the co's basic arguments are the same and the filing is structurally near identical.Favorite Brands Moved from a Maybe to a No Between Sep and Dec Attys for SGWS and Favorite Brands (FB) discussed the subpoena 3 times before FB ultimately opted to deny the request "wholesale," SGWS told the ct. An early Sep meeting led to an extension 'til mid Sep, when FB's atty even suggested that the co will "produce some responsive documents but we will require more time." By mid-Nov, the co "reversed course," in SGWS's view. The request seeks "highly confidential and proprietary business records and trade secret information," FB's atty wrote, citing the co's "relatively small size comparative to other distributors." It came to conclusion that complying with Southern's request "would be adverse and harmful to its business interests."After one more attempt by SGWS in early Dec, including an offer to narrow its request, FB formally declined to produce any responsive documents on Dec 30. Two weeks later Southern filed a motion to compel, arguing in part that "relative market share has no bearing." It dismisses FB's contentions that SGWS's requests are "irrelevant, overbroad, unduly burdensome, and seek confidential information without basis," same way it paraphrased Hensley's reasoning. FB offered no indication of just how burdensome the request is and didn't engage on offers to narrow the request, according to SGWS. And, just as it did against Hensley, the distrib reiterated that the protective order already in place moots FB's concerns about confidentiality.

Favorite Brands in TX, NM Joins Hensley, Pushes Back Against SGWS Subpoena in Dispute with FTC

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