Keurig Dr Pepper (KDP) has been allowed to end its partnership with Reyes Coca-Cola Bottling (RCCB) in the US.
According to reports from Bloomberg, a Texas judge ruled last week that KDP could end its distribution and bottling partnership with Coca-Cola bottler RCCB.
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The ruling reportedly said that the license agreement between both parties “is and shall be terminated” from 27 October.
The move will allow KDP to manage its own direct-store-delivery (DSD) of Dr Pepper products.
In a statement sent to Just Drinks, a RCCB spokesperson said: “We are disappointed in the court’s ruling and respectfully disagree with the decision. We believe the facts and the law support a different outcome.
“At this time, we are carefully evaluating all of our options, including the possibility of an appeal. We remain committed to pursuing the best path forward and will continue to act in the best interests of our stakeholders.”
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By GlobalDataCommenting on the news, KDP said: We look forward to bringing this distribution of the Dr Pepper trademark into Keurig Dr Pepper’s DSD system this fall, further building scale in our routes to market.”
The Canada Dry maker filed its suit in Texas, Bloomberg said, arguing local laws meant that once its agreement with RCCB expired, it was not obliged to renew the deal.
RCCB, on the other hand, reportedly argued that the deal could not be terminated, as laws in California (a market which part of the agreement covers), mean their partnership could only be ended on the basis of performance.
KDP has been building up its own DSD distribution footprint in the US. Last year, the group acquired the Arizona-based bottler and distributor Kalil Bottling Co. for an undisclosed sum.
The company had bottled drinks for KDP. The agreement saw the Dr Pepper brand owner acquire a facility in Tucson, as well as sales and distribution centres in the city and in Tempe.
As part of the deal, KDP also gained bottling and distribution rights in Arizona for brands including Canada Dry, 7Up, A&W, Snapple and Core Hydration.
