BY EVANGELINE DE VERA
THE Marikina regional trial court has ordered
food and beverage conglomerate San Miguel Corp. to pay P133
million in damages to Asia Brewery Inc. for removing over a
million of the latter’s empty bottles and plastic cases from the
market.
In a 47-page decision, Judge Alice Gutierrez
of the Marikina RTC found SMC guilty of unfair trade acts that
made it liable for damages for loss of profits incurred by ABI,
a company owned by taipan Lucio Tan.
The court said it was convinced that ABI,
through its witnesses and documentary evidence, established that
SMC engaged in systematic schemes to pull out the beer products
of ABI from stores and other trade outlets, and that these
schemes involved the withdrawal not only of the empty bottles
and cases, but even the contents of the ABI beer products.
The court said that since bottles and shells
are "essential parts" of ABI’s production, marketing and
distribution systems, SMC’s unfair trade acts caused its rival
to invest more and incur more costs to replace the missing
items.
"To be fair, SMC must also compensate ABI for
the profits that ABI lost as a result of SMC’s unfair trade
acts. By withdrawing the ABI bottles from circulation, SMC
effectively disrupted ABI’s marketing and distribution system
and deprived it of the profits that it could have gained if it
were able to re-use the bottles and shells in the normal course
of trade," the decision dated November 18 read.
The court thumbed down the defense of SMC
that the withdrawal of ABI’s bottles was accidental due to the
alleged confusing similarity between SMC’s Pale Pilsen and ABI’s
Beer na Beer bottles, pointing out that other ABI products with
vastly different bottles like Carlsberg, Stag, Budweiser and
Colt 45 were likewise found in SMC’s possession.
The court further said the supposed bottle
swapping agreement between the two companies, which was
allegedly terminated by ABI, could not be used by SMC as an
excuse.
The Court said ABI had good reason to
terminate the bottle swapping agreement since it was being used
by SMC to cover its unfair trade practices. It added that while
the agreement covered only bottles, the court sheriff found
thousands of ABI crates in SMC warehouses.
Based on court records, a raid of SMC’s three
warehouses in 1997 yielded over 1.6 million bottles of ABI’s
Beer na Beer, Carslberg, Manila Beer, Colt 45, Lone Star and
Budweiser in various sizes, some of which were still unopened.
The sheriff also seized 128,679 ABI red
plastic shells, 468 of which were repainted green with a stamp
of the San Miguel logo in white. The inventory excludes
"unquantifiable" broken ABI bottles which the sheriff discovered
inside another SMC warehouse in Valenzuela City.
ABI filed the civil case for damages and
recovery of possession against San Miguel in 1997 after
surveillance showed that SMC was keeping ABI bottles and shells
in its San Fernando, Pampanga brewing facility. The ABI crates
and bottles were stacked 20 cases high, eight cases wide and 250
yards long.
During the trial, ABI presented seven
witnesses including four former SMC sales personnel.
The former SMC employees testified that they
were aware of a plan by SMC’s top management to "seek total
annihilation and destruction of the enemy (ABI)" through various
schemes which included "buy-outs" or "pull-outs" of ABI products
from various dealers to maintain SMC’s monopoly of the
Philippine beer market.
The witnesses also recalled a 1985 convention in Baguio City
where top SMC executives launched project R.A.M.B.O. which
stands for "Rip Apart Manila Beer Operation," in reference to
one of ABI’s earliest products. They said the buy-out and
pull-out operations were most intensive in 1991 to 1992.
