A Canadian judge on Friday put Molson Coors Brewing Co.’s (TAP) sponsorship deal with the National Hockey League in doubt after ruling the league had reneged on an existing deal with Labatt Breweries, according to the Toronto Star.
The Ontario Superior Court ruled for Labatt, which claimed it already had a Canadian sponsorship agreement in place with the NHL before Molson Coors signed its seven-year North American sponsorship pact in February, the paper said. Labatt said in February that it negotiated a “good faith” contract extension through 2014, The Wall Street Journal reported at the time.
The NHL deal was a coup for Molson Coors, which had lost its sponsorship of the National Football League to rival Anheuser-Busch InBev NV (ABI.BT, BUD) last year. Anheuser-Busch owns Labatt, and Labatt brews Budweiser and Bud Light for the Canadian market.
The Molson Coors deal would make Molson Canadian the official beer of the NHL, with additional consideration for Coors Light.
Justice Frank Newbould recommended an injunction against an NHL-Molson Coors agreement “so far as the Canadian rights are concerned,” the Toronto Star reported. He said Molson Coors knew the league was already partnered with Labatt, according to that paper.
Molson Coors is deciding whether to appeal the decision, the Toronto Star reported, while the NHL declined comment.