Diddy has filed a lawsuit against his business partners at Diageo, a British-based alcohol-distributing company. The rap mogul turned spirits brand entrepreneur alleges that Diageo turned their back on him and his tequila brand, DeLeon. He accuses Diageo of racism and neglect, claiming that they favored other brands like Don Julio and Casamigos while failing to properly market and invest in DeLeon.
Sean “Diddy” Combs’ lawsuit, through his alcohol LLC Combs Wine and Spirits, stems from his acquisition of DeLeon tequila in 2013. After successfully boosting sales of Ciroc, Diddy brokered a partnership with Diageo to lead all marketing and innovation efforts to promote DeLeon. However, he alleges that Diageo refused to properly market and invest in DeLeon while giving preferential attention to white-owned brands including Don Julio and Casamigos. Combs perceives this neglect as racially motivated, with his tequila sales declining and DeLeon frequently experiencing stock shortages. Diddy is seeking compensation for failing to fulfill contractual obligations and potentially billions in damages.
In his lawsuit, Diddy claims that Diageo views his tequila brand as suitable only for “urban consumers,” while focusing more on other popular tequila brands. Don Julio, produced in Mexico, is the largest brand in terms of value in the tequila market, while Casamigos, co-founded by actor George Clooney, is one of the fastest-growing tequila brands. Diddy believes that Diageo’s discriminatory actions have hindered the growth and success of DeLeon.
As part of the lawsuit, Diddy is demanding that Diageo not only compensate for its failure to support his tequila brand as agreed upon in the contract but also potentially pay billions in damages.
Diddy Launches Diddy Direct With DJ Khaled
In an apparent pivot to take control of his alcohol business ventures, Diddy recently teamed up with DJ Khaled to launch Diddy Direct. This platform enables retailers and consumers to easily locate, request, and purchase any items from the Combs Spirits collection, bypassing middlemen like Diageo and marketing directly to customers.
In related business ventures, according to the Wall Street Journal, Combs has purchased three licensed medical operations in three states for $185 million. Those states include New York, Massachusetts, and Illinois.
In a similar legal dispute, rap legend Jay-Z settled his disagreement with Bacardi in February. Bacardi purchased a majority stake in Jay-Z’s half of D’Usse, a partnership valued at approximately $750 million, establishing a new partnership.