Ballester Hermanos, Inc. v. Brugal & Cia. C. por A.
3:19-cv-02100
D.P.R.Mar 20, 2025Background
- Ballester Hermanos, Inc. was an exclusive distributor of Brugal's rum in Puerto Rico beginning around 1990.
- In 2008, Edrington acquired a majority of Brugal’s shares and began managing Brugal’s overseas distribution, including in Puerto Rico.
- In 2019, Edrington notified Ballester that their distribution arrangement was terminated and chose a new distributor.
- Ballester sued Brugal in federal court for violation of Puerto Rico Dealer’s Act (Law 75) and later amended to include Edrington as co-defendant, adding claims for Law 75 and tortious interference.
- Separate state court litigation by Ballester against Edrington for tortious interference was dismissed, with courts finding Edrington was the principal party to the contract; the decision became final.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Tortious interference against Edrington | Edrington tortiously interfered with Ballester’s contract with Brugal | Dismissal in Puerto Rico courts is res judicata; Edrington is principal, not third party | Claim barred by res judicata |
| Law 75 claim against Brugal | Brugal remained principal or co-principal under Law 75 | Edrington, not Brugal, is principal per Puerto Rico courts; Brugal's obligations extinguished | Claim barred by res judicata |
| Law 75 claim against Edrington (timing) | Claim timely due to relation back under Rule 15(c) | Claim untimely—filed more than 3 years post-termination, statute of limitations bars | Claim relates back; not time-barred |
Key Cases Cited
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (summary judgment standard)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (standard for defeating summary judgment)
- Celotex Corp. v. Catrett, 477 U.S. 317 (movant's burden in summary judgment)
- Calero-Cerezo v. U.S. Dep’t of Justice, 355 F.3d 6 (standard for "genuine dispute" in summary judgment)
- Dillon v. Select Portfolio Servicing, 630 F.3d 75 (affirmative defense of res judicata)
- R.G. Fin. Corp. v. Vergara-Nunez, 446 F.3d 178 (res judicata requirements in Puerto Rico)
- Barreto-Rosa v. Varona-Mendez, 470 F.3d 42 (preclusive effect of Puerto Rico court judgments)
- LeBlanc v. Great Am. Ins. Co., 6 F.3d 836 (evidence required to defeat summary judgment)