In a case that hinged on the definition of "beer," a federal jury ruled Wednesday that Constellation Brands can still sell Corona and Modelo hard seltzers in the U.S.
Anheuser-Busch InBev and its Mexican subsidiary, Grupo Modelo, sued Constellation in 2021, seeking to force it to halt sales of Corona Hard Seltzer and Modelo Ranch Water, a spiked sparkling beverage.
Constellation has been licensed to sell Corona and Modelo beers in the U.S. since 2013 under an agreement reached with antitrust regulators after AB InBev acquired Grupo Modelo. Under the agreement, "beer" is defined as "ale, porter, stout, malt beverages and any other versions or combinations of the foregoing, including nonalcoholic versions."
In its complaint filed in federal court in New York, Grupo Modelo said the seltzers don't fall under those definitions. It sought to halt their sale and force Constellation to pay damages.
But in its court filings, Constellation, which is based in Victor, New York, said its hard seltzers fall under the "malt beverage" category, and that the licensing agreement gives it the right to develop and market Corona beverages.
U.S. District Judge Lewis Kaplan declined to dismiss the case before a jury trial, ruling in December that the contract's definition of "beer" was too ambiguous.
In a statement issued Wednesday, Grupo Modelo said it was disappointed in the verdict and was evaluating its options.
According to Reuters, a Constellation spokesperson said the company was pleased with the verdict and remains "committed to continuing to operate in accordance with the terms of our sublicense agreement."
