Interview: Larry Bell, Bell's Brewery
By Karl Klockars in Miscellaneous on Dec 4, 2007 6:33PM
Our ears perked up a few months ago at a posting on LTHForum about Bells Brewery reintroducing themselves into the market under a different label. Hopes were raised that maybe this winter we'd get a Two-Hearted Ale, a Cherry Stout, that maybe we'd have a replacement for Bell's Oberon this summer.
On the day of the rollout of the new Kalamazoo brew, we got in touch with Larry Bell about the pullout of Bell's Beer from the Chicago market, where we can find the new Kalamazoo offering, and more about wholesaler law than we ever thought we knew.
Where exactly could an intrepid beer explorer find this new beer? Will we get an unfiltered wheat ale, (coughOBERONcough) next year? Cross your fingers and read more after the jump.
Chicagoist: Before I ask you about the new beer, give me the Cliffs Notes on your pullout from the Chicago market. It's basically a dispute with your distributor, correct?
Larry Bell: Pretty much. National Wines and Spirits last year was trying to sell the Bells brand, and we did not come to an agreement on the brand being sold. And at that point we really couldn't afford to stay in the Chicago market.
C: Are there any plans to bring back the Bell's label itself back to Chicago?
LB: I don't forsee that right now. I can't see that right now. Right now National Wine and Spirits owns the rights to Bells forever. We are unable to reach any agreement with them, and so nothing happens with it.
C: You know, it doesn’t seem right that you don’t have control over your own product. I mean…forever?
LB: Well, yeah...you know, there are reasons for the law (ed. note: the law Bell is talking about is the Beer Industry Fair Dealing Act of 1982, the details of which, in complicated legalese, can be read here). Those laws for the wholesalers were written so that wholesalers were protected from big breweries crushing the wholesaler. And that's certainly understandable. Hopefully over time, we can look at some ways that maybe some smaller breweries can have a little bit more protection. But like I say, we've dealt with these laws in other states, and it's been fine. It's unfortunate that our relationship with National Wines and Spirits has degenerated so bad that no deal can be done.
Y'know, the thing is, the law isn't so much different than a lot of states that we do business in. But unfortunately, National Wines and Spirits wanted to use some real hardball tactics, and wasn't interested in working with their so-called brewery partners when they were doing all this change last year. Because our brand has been bought and sold any number of times.
C: Is it still just business at this point, or is it personal?
LB: I don't think there's any love lost between the two companies. [laughs] We are really grateful for these first two wholesalers to pick us up, and we're generally pretty supportive of what's called the three tier system of beer distribution in the US. I don't want people to get the impression that I'm out there bashing wholesalers, because I'm not.
Unfortunately, I got into a relationship with a wholesaler that didn't have our best interest at heart.
C: So is this a sort of re-entry of the market for Kalamazoo, and by proxy Bells?
LB: We're not re-entering the market as Kalamazoo Brewing. Kalamazoo Brewing is the former name of the corporation. The name of the corporation is Bells Brewery Incorporated now. We are re-entering the market with a new brand called Kalamazoo.
C: This seems like something of a legal loophole.
LB: Well, the law says that you can assign a new brand to whatever wholesaler you want. There was in this last year a case concerning brand extension in Illinois, where Heineken had come into Illinois with Heineken Premium Light, had assigned it to a different wholesaler, and the Heineken wholesaler sued saying they had a right to it. Well, they lost. Illinois then changed their law to say that a brand extension has to go to the wholesaler of that brand. Well, that's fine. What we're coming back with is not a brand extension, but actual new brands.
C: So you of course have a different distributor for this product.
LB: That's correct. We have assigned two distributors, Central Beverage and Schamberger.
C: I'm guessing you plan on getting sued over this.
LB: We don't know. In October in a conversation with National Wines and Spirits, at that point they told me their intention was to sue us, and make it as lengthy and costly a court battle as they could. Whether or not that's still their opinion, I don't know.
C: Was this based on the dispute over the Bells brand, or did it have to do with this new Kalamazoo label?
LB: No, that was [for] Kalamazoo, they're certainly aware of our intentions.
C: So, about this new beer – what exactly is the deal?
LB: Well, it actually shipped from the brewery [December 3rd]…and goes on tap [Tuesday, December 4th].
C: I've seen info on a few different beer labels for the Kalamazoo Brewery - what are you rolling out?
LB: We are rolling out one beer in about ten accounts, on draft only. That is the Kalamazoo Royal Amber Ale.
C: Is there any equivalent to an existing Bell's product?
LB: These are new products. They're different recipes, they have their own unique flavor profiles.
C: Do you have plans to bring anything else to the market?
LB: Basically, we've got to wait and see what's going to happen. If National decides that they do indeed want to sue, then I suspect they'll have to do that fairly quickly, and we'll all wind up in court to see what the judge has to say.
When I spoke to them in October, they had told me that they intended to get a temporary restraining order against us. So, we'll see. And then go from there. We've got some legal opinions that say that the law is on our side. we believe that we would prevail in a court of law for the right to sell this brand, but we are moving ahead very slowly...and deliberately.
Again, if National wants to do something they'll have to do it relatively soon, they'll have to let us know that they're going for the restraining order and we would all go to court together. And I would suspect that if that were to happen then I think it would happen next week. It would have to happen relatively soon.
C: So, in a perfect world, is there any chance we'll get something like an Oberon next summer?
LB: We have registered a trade name for a Kalamazoo unfiltered wheat ale, so there's a possibility that an unfiltered wheat beer could see Chicago.
If we do prevail, there's one other name that we filed for that we don't have label approval for, but I was able to make a special purchase of some European hops this last year, a relatively small quantity...but we've been holding on to those, and if everything goes our way then we will make a special double IPA for the Chicago market using those.
Outside the city, Kalamazoo will be at Brixie's, Kendall Pub, Chef Paul's Bavarian Lodge, Jimmy's Grill, Old Town Pub - Geneva and Wasco, and will also be available at Durty Nellies next week. Larry Bell image via Southwest Michigan First.