Grub Street has bad news for the residents of Portland and Brooklyn.
There was a time, not so long ago, when Pabst Blue Ribbon and the term â€œhipsterâ€ were more or less synonymous. The watery budget brew was catnip for urban creatives, and business was thriving. In 2003, when the Times first took notice of PBRâ€™s bike-messenger cachet, the paper reported that sales had risen 5.3 percent the year before. It was the start of a boom. By 2009, sales were growing by 25 percent. In 2011, someone went on record with the Chicago Tribune to call it â€œthe nectar of the hipster gods.â€ David Chang put it on tap when he opened a Momofuku outpost in Toronto.
The beerâ€™s cultural bona fides were always something of an instant clichÃ©, but now PBR is in danger of receiving the ultimate badge of hipster credibility: being killed by big business.
Despite the name of the Pabst Brewing Company, they donâ€™t brew the PBR that was beloved by everyone living in Williamsburg in 2009. For years, Pabst has outsourced its beer-making to MillerCoors, a relationship that has suddenly gone sour. The two companies are locked in a half-billion-dollar court battle that, some say, could spell the end of PBR, as well as many other beer brands that Pabst owns. Pabst currently pays MillerCoors nearly $80 million a year to brew its beer; MillerCoors says that, after 2020, it may no longer have the necessary resources available, and is threatening to let the contract expire unless Pabst agrees to a fee thatâ€™s closer to $200 million per year, an amount that Pabst contends would â€œbankrupt us three times over.â€ …
Pabst closed its flagship Milwaukee brewery in 1996. When Pabstâ€™s last brewery, in Fogelsville, Pennsylvania, closed in 2001, it shifted brewing responsibilities to Miller. In the meantime, Pabst was also focused on buying plenty of beer brands that werenâ€™t PBR, including Lone Star, Schlitz, and Schaefer (â€œthe one beer to have when youâ€™re having more than oneâ€). â€œWe own 77 brands, and 50 of them are dormant,â€ current owner Eugene Kashper told a New Jersey paper in 2015. â€œWe have a virtual monopoly on American heritage brands.â€
What Pabst doesnâ€™t own is a brewing complex to make its beer. The company did recently offer $100 million for a shuttered facility in North Carolina, but that breweryâ€™s owner, which is â€” wait for it â€” MillerCoors, made a counter offer of $750 million, effectively ending negotiations.
Pabst is stuck. Its products are brewed, packaged, and distributed by a rival who seems to have no interest and, MillerCoorsâ€™s lawyers argue, no obligation to keep the relationship alive. Now, according to the AP, Pabst â€œis seeking more than $400 million in damages and for MillerCoors to be ordered to honor its contract.â€
Hmmm. Hiring your competitor to make your product, then sitting back and essentially collecting rent, has a down-side! Who would have imagined?