‘Illusion of inclusion’: Diddy sues company behind his liquor brands for discrimination

Business mogul Sean “Diddy” Combs has sued the British beverage company that co-owns his liquor brands, claiming that the spirits giant Diageo has “kneecapped” his Ciroc and DeLeon labels’ sales growth for almost a decade and starved them of resources while better marketing its other brands such as Don Julio and Casamigos.

Diddy’s Combs Wines and Spirits LLC is alleging that Diageo treated his DeLeon tequila and Ciroc vodka as inferior “Black brands” or “ethnic brands” that should be targeted to “urban” consumers, according to a racial discrimination lawsuit his company filed Wednesday in New York Supreme Court in Manhattan.

The hip-hop icon claims that Diageo North America Inc. has “proven unwilling to treat its Black partners equally” by failing to making promised investments in Diddy’s products. He is is seeking a court order “to provide the equal treatment” that he alleges Diageo “contractually promised” and intends to pursue “billions of dollars in damages due to Diageo’s neglect and breaches” in a separate lawsuit.

“In public, Diageo — a multi-billion dollar, publicly-traded spirits company — proclaims itself a leader in diversity and inclusion,” the complaint, obtained Wednesday by The Times, said.

“Cloaking itself in the language of diversity and equality is good for Diageo’s business, but it is a lie,” the lawsuit said. “While Diageo may conspicuously include images of its Black partners in advertising materials and press releases, its words only provide the illusion of inclusion.”

The Bad Boy Entertainment executive says that for years Diageo deliberately undermined their joint-venture agreements and “starved” his brands of resources in production, distribution and sales while investing in Diageo’s other competing labels, namely Don Julio, 21 Seeds and the lucrative Casamigos tequila, which was formerly co-owned by actor George Clooney. Diddy claims his brands “were allowed to wither,” getting increased attention only if Combs Wines “demanded it under threat of legal action,” and experienced “systematized neglect” amid agave shortages, “out of stocks” and glass supply chain issues.

Combs Wines also alleges that Diageo produced lower quantities of DeLeon compared to Don Julio and Casamigos, distributed it in far fewer outlets, failed to provide “sufficient and substantially consistent support” for the brand, limited its marketing and promotion to “urban” communities and failed to include DeLeon in non-brand-specific pages and promos online where its other brands were showcased.

The Grammy winner says that Diageo — owner of more than 200 brands, including Guinness beer and Tanqueray gin — first approached him in 2007 to help its then struggling Ciroc label. Diddy, also known as P. Diddy and Puff Daddy, says in the lawsuit that he agreed to use “his widely known name and influences to help promote and market” the brand, claiming that he “sparked spectacular growth” despite Diageo‘s failure to devote the “proper attention” and resources they promised when they partnered.

The “I’ll Be Missing You” and “All About the Benjamins” rapper alleges that Diageo leadership told him that his race was among the reasons for his brands’ limited distribution to urban neighborhoods and that he was told that some Diageo executives resented him for making too much money. Some leaders, the suit alleges, even regarded the billionaire merely “as a Black man that might prove useful in marketing to Black consumers. Nothing more.”

He claims that their business relationship was tainted by racial prejudices, that he voiced his frustrations for years and that he repeatedly attempted diplomacy only to be met with false promises, discriminatory conduct and backward treatment, the filing said. After taking action in 2021 but failing to resolve the matter with company brass, Diddy this week took his issues to court.

“Through the present lawsuit, Combs Wines seeks to finally put an end to Diageo’s longstanding misconduct,” the filing said. “Combs Wines demands nothing more than what Diageo has promised to consumers, shareholders, business partners, and Combs Wines itself. Diageo must be ordered by a court to give Combs Wines the same treatment it gives its other, successful tequila brands. It is time that Diageo’s actions match its words.”

In a statement issued Wednesday to The Times, Diageo denied allegations of racism.

“This is a business dispute, and we are saddened that Mr. Combs has chosen to recast this matter as anything other than that,” a spokesperson for the company said. “Our steadfast commitment to diversity within our company and the communities we serve is something we take very seriously. We categorically deny the allegations that have been made and will vigorously defend ourselves in the appropriate forum. “

The company said that it has had “a productive and mutually beneficial relationship” Diddy for 15 years and has made “significant investments that have resulted in financial success for all involved.”

“We are disappointed our efforts to resolve this business dispute amicably have been ignored and that Mr. Combs has chosen to damage a productive and valued partnership. While we respect Mr. Combs as an artist and entrepreneur, his allegations lack merit, and we are confident the facts will show that he has been treated fairly,” the statement said.

Diageo has 20 days to respond to Diddy’s complaint.