Constellation Donates More than $2.5 MM For Restaurant, Bar and Other COVID-19 Relief

Dear Client:

Today Constellation is announcing that it is donating more than $2.5 million, mainly to help the restaurant and bar industry get back on its feet amid massive closures wrought from COVID-19. 

Constellation partnered with its flagship brands — including Corona Extra — to contribute $1 million to an upcoming Restaurant Employee Relief Fund from the National Restaurant Association Educational Foundation. 

Constellation chief Bill Newlands expressed the company’s empathy for the bar and restaurant industry, which has been debilitated by virus containment efforts.

“These businesses are essential to the fabric of our communities,” he said. “It’s important that we all come together to help those most in

need in this critical time. We are focusing our support on efforts that directly benefit those impacted today while also helping the larger industry on its path to recovery.”

Modelo’s efforts were focused specifically on bartender relief: It pledged (with Constellation) $500,000 to the U.S. Bartenders’ Guild,

a non-profit currently offering aid to impacted bartenders.

But not all Constellation COVID-19 funds will go to the restaurant and bar industry. True to its “Fighting Spirit” positioning, Modelo “has contributed an additional $250,000 to support first responders as they continue to support those in need in communities across the U.S.,” the company said. 

Finally, the company is leveraging its thousands of American employees to help. It established a Constellation Brands COVID-19 Crisis Relief Fund, where it will match employee contributions 2:1 to benefit non-profits supporting COVID-19 impacted communities. 

It has also launched an “employee effort to support local restaurants via take-out and delivery orders.” 

HOW HUSA IS ADJUSTING IN THESE CRAZY TIMES

Heineken USA chief sales officer Jim Sloan sent out a memo to distributors yesterday updating them of their plans during these uncertain times.

Like a lot of brewers, they’ve been forced to scrap some of their marketing plans for the year.

HITTING PAUSE ON SOME PROGRAMS AND BIG CAMPAIGNS. The “Bring Your Beer to Work Month” program for Heineken 0.0 is obviously a no-go. They’ll look to revisit the program next year. 

But they’re still shooting for their goal of 5 million Heineken 0.0 samples this year. So they’re asking distribs for their support on the Heineken® Can 15pk (12pk + 3 extra Heineken 0.0), which will be available for order on April 1, 2020 while stocks last.

The new Dos Equis campaign, “Interesting Beer for Interesting Times,” is also being put on ice.  “While our campaign was developed to be light-hearted, and promote social interaction, in light of the current environment we deemed it to be no longer appropriate at this moment in time,” said Jim. They’re working on “new credentials-focused TVC” to sub in its place.

ROLLING WITH “GENERIC THEMATIC POS” FOR THE TIME BEING. The company also reminded distributors to be conscious of the POS they’re putting up in stores, i.e. don’t promote any of the postpone/cancelled events, like the James Bond Heineken program or the annual Dos Equis 3X3U tournament; and don’t put up any POS that encourages social gathering, like the “Dos Equis Cinco de Mayo Sweepstakes.” Instead, they’re asking distribs to replace these with “generic thematic POS.”

HOW THEY’RE GOING ABOUT THE ON-PREMISE. As far as the on-premise goes, HUSA said they’re “working with our national accounts customers and independent on-premise outlets to support To-Go activity where legal by prioritizing shipments of core SKUs and advising all to work with their local distributor reps to place orders.” They urged distribs to contact their HUSA rep if they’re “in need of Heineken & Dos Equis 6 pack carriers for existing Loose Bottle inventory for On Premise To-Go execution and support.” 

In that same vein, HUSA has made the call to “temporarily” halt the production of keg beer. “While many distributors have contacted us to cancel your keg beer orders, all remaining full truckloads (FTL) keg orders have been cancelled. Keg orders that are not FTL, have had kegs replaced by other core SKU’s (cans or bottles), so that we maintain full truck loads,” Jim shared.

SUPPLY UPDATE. When it comes to operations, HUSA assured distribs that “all” of their breweries, as of now, “are fully operational and continue shipping beer to HUSA” and their “truck availability is also at a healthy level.” They also reminded that despite the Trump administration’s call to shut down the border between the U.S. and Mexico, the closure “doesn’t apply to trucks or trains” and the border is “flowing well.” But if there is “any possible border disruption,” Jim says they’ve gone ahead and “moved significant inventory from Mexico to the US side of the border in Laredo.”

UPDATE IN BRIZZY VS. VIZZY FIGHT: JUDGE DENIES FUTURE PROOF’S REQUEST FOR PRELIMINARY INJUNCTION 

Future Proof’s first crack at thwarting the coming launch of Molson Coors’ Vizzy has come up short.

U.S. District Judge James Nowlin denied Future Proof’s recent preliminary injunction request earlier this week, stating that the company “has not clearly carried the burden of proving it is likely to succeed on the merits of its trademark infringement claim.”

BACKGROUND. Future Proof, as you may know, has spent the better part of this year arguing that Molson Coors’ coming seltzer, Vizzy, is an infringement against their own hard seltzer, Brizzy. 

The company sent a formal cease and desist letter to Molson Coors in late January [see BBD 01-29-2020], and followed that up with a complaint against the brewer in early February [see BBD 02-10-2020], and a motion for preliminary injunction, as well as a request for expedited discovery later that month.

THE LATEST. As stated up top, Future Proof received their answer on the preliminary injunction request on Tuesday, and it’s gonna be a ‘no’ from the Federal judge.

Indeed, reading over the response from the Judge, it looks like Future Proof is facing an uphill battle in this litigation.

A FEW WINS FOR FUTURE PROOF. He threw Future Proof a bone saying the Court “agrees” that “the products are similar and, at least in the four states where [Future Proof’s] product is sold, the retail outlets, purchasers, and advertising media used will likely be similar.”

BUT COURT DOESN’T SEE A “HIGH LIKELIHOOD” OF CONFUSION. Beyond that, however, the Court isn’t really siding with Future Proof’s arguments.

THERE ARE GOING TO BE NAME PLAYS OFF “FIZZY.” For starters, the Judge said Future Proof “cannot realistically hope that by obtaining a mark based on and characterized dominantly by one word (“fizzy”), it can prevent competitors from doing the same.” 

PACKAGING “COULD NOT BE MORE DIFFERENT.” He added that “the conceptual strength of the BRIZZY mark is weak, and that Defendants’ use of the Vizzy mark is ‘sufficiently different to negate any confusing similarity.’” Indeed, they found “that the beverage’s logos, font, coloring, cans, and packaging could not be more different.”

That said, the Court “does not believe that there is a high likelihood of a customer thinking the marks are similar…. the marks sound quite similar but look overwhelmingly different.”

“INCREDIBLY UNLIKELY” THAT MC TRIED TO CASH IN ON BRIZZY MARK WITH VIZZY. And the Judge also said the Court found it “incredibly unlikely” that Molson Coors drew any inspiration from Brizzy for Vizzy. “Defendants came up with the Vizzy name a few months before BRIZZY had been launched,” the Judge said, “so the Court finds it incredibly unlikely that an intent to derive benefits from Plaintiff was the impetus behind Vizzy’s name.”

With the preliminary injunction denied, the court said it is “further of the opinion that Plaintiff’s Motion for Expedited Discovery is now moot.”

MOLSON COORS CALLS RULING A “CONFIRMATION.” “The federal judge’s ruling confirms what we’ve always maintained, we have the right to launch and fully support Vizzy, a new, differentiated hard seltzer with antioxidant vitamin C from acerola superfruit that has retailers and distributors excited,” said Molson Coors’ head of comms, Adam Collins.

More as it rolls in, stay tuned.

HOW CRESCENT CROWN IS HELPING FURLOUGHED RESTAURANT WORKERS IN ARIZONA

Arizona wholesaler Crescent Crown is making a generous gesture to the on-premise workers out of a job in their backyard.

The distributor has pledged to donate “15 cents per case of beer that it sells” from now through April 30 to the on-premise personnel Arizona affected by the closures from the COVID-19 outbreak, reports the Arizona Daily Star.

While it is unknown how much money that pledge will provide, the distributor says it will contribute “a minimum of $50,000 to benefit furloughed employees of statewide Arizona Licensed Beverage Association member businesses, which represents 600 retailers and 12,000 employees,” ALBA president Dave Delos told the outlet.

Additionally, the wholesaler has also promised “a minimum $200,000 to the Arizona Restaurant Association to provide financial aid to furloughed restaurant workers statewide,” per report.

The commitment is an “unbelievable gesture,” ALBA president Dave Delos said. “People are starving out here… people have lost their jobs and a lot of them live paycheck to paycheck.”

Crescent Crown GM Joe Cotroneo said they could top those pledges depending on sales, but no matter the amount, the money is going solely to “frontline workers” in the channel.

“We don’t want the money going to the bar and restaurant owners. I’m sure they are hurting, as well,” but it’s the hourly workers who are really hurting, Joe told the outlet.

“My hope, honestly, was that other companies will see what we’ve done and follow suit,” Joe said.

MASS EXTENDS TERMS TO 90 DAYS FOR ON PREMISE RETAILERS

Ailing retailers got a little reprieve late last week when the ABC issued an advisory extending all credit terms from invoices to 90 days for on premise retailers. 

“In light of the unprecedented COVID-19 pandemic, the ABCC recognizes the hardship posed to § 12 licensees to comply with the sixty-day credit terms on invoices,” as outlined in prior directives.

Thus the Commission has ordered that “credit terms for all invoices issued on or after January 18, 2020, to § 12 licensees are extended by thirty days to a total of ninety days for payment of those invoices.” That’s not applicable to any other license type, or licensees already listed on the credit delinquency list. 

These extended terms apply automatically for those eligible licensees (per details above). 

“This order shall remain in effect until rescinded by the Commission,” it said. 

Until tomorrow,

Harry, Jenn and Jordan

“The world breaks everyone and afterwards many are strong at the broken places.” – Ernest Hemingway

———- Sell Day Calendar ———-

Today’s Sell Day: 19

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Sell days this month last year: 21

This month ends on a: Tues.

This month last year ended on a: Fri.

YTD sell days Over/Under:  +1