Stillhouse Spirits sues Bacardi for $100m
The CEO of Stillhouse Spirits, a company backed by hip-hop artist G-Eazy, is suing minority stakeholder Bacardi for US$100 million for alleged extortion, fraud, breach of contract and financial wrongdoing.
Brad Beckerman, founder, CEO and chairman of Stillhouse Spirits, filed the lawsuit against Bacardi yesterday (27 March).
He claims his company is now in “mortal danger due to the financial malfeasance of Bacardi and the other financial partners”.
The lawsuit alleges that: “Bacardi convinced Beckerman to provide it inside access and control of Stillhouse through a series of false representations and promises of support.
“To induce Beckerman to relinquish majority ownership and control of Stillhouse, Bacardi represented to Beckerman that it would in the future bring Stillhouse ‘in house’, by buying all of the equity of Stillhouse, including Beckerman’s, at a fair market price.”
It continues to claim that in February and March 2019, Stillhouse experienced record-breaking success and sales, and Bacardi has allegedly “schemed to take the company on the cheap” and has “cut off funding for the company”.
Attorney Skip Miller, a partner at Miller Barondess, in Los Angeles, is representing Beckerman in the lawsuit.
Bacardi, which acquired a minority stake in Stillhouse Spirits more than four years ago, said it has provided “substantial backing” for the company over the years.
However, according to Bacardi, Stillhouse Spirits has apparently “repeatedly failed to deliver the growth promised” and “continued to spend beyond the board-approved budgets”. It claims Stillhouse Spirits is now “on the verge of bankruptcy”.
In a statement, Bacardi said: “Bacardi is an entrepreneurial company with a proven track record of working with new and emerging brands to grow them into household names.
“We made a minority investment in Stillhouse over four years ago because we believed it could be an exciting and disruptive product, and we provided the company with significant ongoing financial and other support.
“Despite our substantial backing, management repeatedly failed to deliver on the company’s business plan and Stillhouse is now on the verge of bankruptcy. Under the leadership of CEO Brad Beckerman, the company has repeatedly failed to deliver the growth promised, and continued to spend beyond the board-approved budgets.
“For nearly six months, we have been diligently working with the other shareholders to find a solution that would save the business. It is very unfortunate that Mr Beckerman would jeopardise Stillhouse’s ability to continue as a going concern by unilaterally filing this frivolous lawsuit just as we were nearing a mutually beneficial resolution.
“The complaint is filled with inaccuracies and misstatements, and we look forward to providing the entire story at the appropriate time. We intend to defend this action vigorously.”