Tuesday, December 16, 2014

Class action suit against Ontario beer monopolies

LCBO and Beer Store 'sweetheart deal' lawsuit calls for $1.4 billion in damages - Market Business News- Joseph Nordqvist:

December 14, 2014 - "A secret deal signed in 2000 between the LCBO and the Beer Store, limiting competition between Ontario’s provincial and private alcohol monopolies, has resulted in a class-action lawsuit.

"The retail outlets have been alleged of being part of a 'conspiracy to fix, raise, maintain or stabilize prices of beer in Ontario' and 'participated in illegal and secretive discussions and made agreements relating to prices and distribution areas of beer in Ontario.'

"The class-action lawsuit calls for $1.4 billion in damages. It has not yet been proven in court and the lawsuits need to be given the green light by a judge before proceeding as actions.

"The claim also demands $5-million in 'punitive and exemplary damages.'

"London, Ontario based Siskinds LLP filed the court documents on behalf of David Hughes and a company that operates a restaurant called The Poacher.

"Earlier this week the Toronto Star reported on a secret ‘sweetheart deal’ made between the LCBO and the Beer Store in June 2000.... As a result of the deal Ontarians can, for the most part, only buy larger cases of beer at the Beer Store. Prices of beer at the Beer Store are set by the three Belgian, Japanese, and American brewing companies that own the corporation. Labatt Brewing Company (AB InBev) has a 49% stake, Molson Coors Brewing Company owns 49%, while Sleeman Breweries (Sapporo) has a 2% stake.

"The Canadian restaurant industry group, Restaurants Canada, demanded that the Ontario government cancel this 'sweetheart deal'. It said that it has asked for an investigation to be carried out by the federal Competition Bureau.... According to Restaurants Canada, the deal limits competition and increases the cost of beer in bars and restaurants."

Read more: http://marketbusinessnews.com/lcbo-beer-store-sweetheart-deal-lawsuit-calls-1-4-billion/40861
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