P Diddy

Dispute Between Sean “Diddy” Combs And Diageo Escalates As Court Reveals Business Details

Sean “Diddy” Combs, a rapper, producer, and entrepreneur, has petitioned the Supreme Court of New York to enforce a 2021 agreement that requires Diageo to treat his DeLeon tequila brand “at least as favorably” as its other tequila brands.

Combs signed the agreement with Diageo, which owns more than 200 brands, including Guinness beer and Tanqueray gin, after what he claims were years of negligence for DeLeon, a brand he founded with the London company in 2013.

Combs filed a lawsuit against Diageo in May. At the time, however, many details, including the 2021 agreement, were redacted. On Wednesday, these details were made public after Judge Joel Cohen ruled that Diageo could keep only a fraction of them secret.

Combs asserts that Diageo’s treatment of DeLeon deteriorated after it acquired two competing tequila brands in 2014 and 2017: Don Julio and Casamigos. Combs, who is African-American, asserts that Diageo positioned his tequila as an inferior “urban” brand and restricted its distribution.

Diageo refutes Combs’ allegations. Late in June, it requested that the court order arbitration or dismiss the lawsuit. Additionally, the company is terminating Combs’ partnership with Ciroc vodka, a brand he has promoted since 2007.

According to Combs, the newly released documents detail Diageo’s recurrent divestment from DeLeon. DeLeon was distributed in 3% of conceivable outlets as of the previous year, whereas Don Julio was available in 36%. In the past year, DeLeon has been listed as “out of stock” at least ten times on key markets, according to the lawsuit.

Combs reported that he was informed in 2021 that all of Diageo’s agave plants had been allocated to other labels, forcing DeLeon to scramble to find suppliers on the more expensive spot market. Combs asserts that Diageo made unilateral decisions that were detrimental to the brand, such as discontinuing popular 375-milliliter “half bottles” and releasing a redesigned container without marketing support.

Combs asserts that prejudice frequently influenced Diageo’s decisions. He was adamant that DeLeon not offer flavored varieties until consumers had had more time to become familiar with the brand. However, Diageo went ahead and developed a watermelon flavor, despite Combs’s prior warnings about the discriminatory history of watermelon in relation to a brand aimed at Black consumers.

Diageo responded by noting that Combs has supported and endorsed Ciroc Summer Watermelon for multiple years.

“His attempt to recast subsequent discussions regarding innovations for DeLeon is dishonest and self-serving,” Diageo said in a statement released on Wednesday.

Combs claimed in his lawsuit that he only agreed to promote Ciroc Summer Watermelon after educating the company about watermelon and receiving assurances from Diageo that it would avoid any negative connotations. Combs also distinguished Ciroc, which has over a dozen flavors, from DeLeon, whose first flavor would have been watermelon.

Combs claims that internal Diageo documents proposed downplaying Ciroc’s connection to him in an effort to diminish the brand’s “image of being an African-American brand.”

In its own court filings, Diageo accuses Combs of using “false and reckless” allegations to seek monetary damages. Since the 2021 agreement, Diageo says it has increased production of DeLeon and sales have doubled.