669 F.3d 873
8th Cir.2012Background
- MoBev is a Missouri wholesale distributor of spirits, wines, beers, and related products; Shelton is a Massachusetts supplier of artisanal beers distributed via wholesalers.
- In 2004, MoBev and Shelton formed an oral agreement under which MoBev could purchase Shelton beer, with no guaranteed quantities or exclusivity.
- Shelton sent Missouri notices of distributor appointments from 2004–2008; MoBev conducted Shelton-focused sampling events in 2008–2009.
- In 2010, Shelton ceased supplying products and terminated MoBev as Missouri distributor; MoBev sued in state court asserting Missouri franchise-law violations.
- District court or later removed to federal court granted summary judgment for Shelton, holding the MoBev-Shelton relationship did not meet Missouri’s franchise definition.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does § 407.400(1) apply to liquor supplier–wholesaler relations? | MoBev argues the general definition applies to liquor relationships. | Shelton contends only the specific liquor-definition governs, not the general definition. | General definition applies to liquor supplier–wholesaler relationships. |
| Do MoBev and Shelton satisfy the general definition's elements? | MoBev asserts there was an oral arrangement involving use of Shelton’s brand/trade-name potential leverage. | Shelton contends MoBev did not receive a license to use Shelton’s trade name and offered no community of interest. | No franchise relationship; no license to use trade name and no community of interest. |
| Did Shelton grant a license to use a trade name or related characteristic? | MoBev relied on use of Shelton’s goodwill and marks to market products. | Shelton never granted MoBev a license to use its trade name or related goodwill. | No license granted. |
| Was there a community of interest between Shelton and MoBev? | MoBev argues some mutual dependence and investment in Shelton's brands. | Shelton argues no substantial, franchise-specific investments or dependence. | No community of interest. |
Key Cases Cited
- High-Life Sales Co. v. Brown-Forman Corp., 823 S.W.2d 493 (Mo. banc 1992) (statutory framework; general vs. liquor-specific franchise definitions)
- Brown-Forman Distillers Corp. v. McHenry, 566 S.W.2d 194 (Mo. banc 1978) (interpretation of franchise statute including liquor provisions)
- Neptune T.V. & Appliance Serv., Inc. v. Litton Microwave Cooking Prods. Div., 462 A.2d 595 (N.J. Super. Ct. App. Div. 1983) (community of interest framework for franchise relationships)
- Cooper Distrib. Co. v. Amana Refrigeration, Inc., 63 F.3d 262 (3d Cir. 1995) (two-part test for community of interest)
- McHenry, 566 S.W.2d 194 (Mo. banc 1978) (text and scope of Missouri franchise statute including 1975 amendment)