Billionaire Sean ‘Diddy’ Combs threatened racism claims for payout, Diageo claims

Feyisayo Ajayi -

In the ongoing legal dispute between Sean “Diddy” Combs and spirits giant Diageo, the company alleges that Combs attempted to extort millions by threatening to label the firm as racist.

This comes in response to Combs’ lawsuit, where he alleges discrimination towards his DeLeon brand. Diageo, in its counterargument, disputes Combs’ allegations, insisting it has always supported his brands. The company alleges that Combs demanded significant sums and threatened to accuse them of racism if his demands weren’t met.

Specifically, after Diageo pledged $100 million in May 2021 for COVID-19 recovery in the hospitality industry and underserved communities, the company claims Combs demanded the same amount. He allegedly threatened to “burn the house down” by making public racism allegations if they didn’t comply.

Combs’ attorneys refute these claims, arguing Diageo neglected DeLeon Tequila brand, impacting its sales. Combs suggests this was due to Diageo perceiving DeLeon as a Black brand, thereby offering it less support.

Early in September, Combs secured a preliminary victory against Diageo, pushing the case from arbitration to public court. Diageo has labeled Combs as an “unreliable and untrustworthy business partner.”

In 2007, Combs Wines and Spirits formed a partnership with Diageo to market Ciroc. By 2013, Diageo had acquired DeLeon tequila. Combs alleges that a Diageo executive once said his brand would’ve gotten more promotion if owned by Martha Stewart.

Diageo insisted the allegations lacked merit and insisted that he was treated fairly.

In terms of distribution, DeLeon tequila had only 3.3-percent retail presence, in contrast to Diageo’s Don Julio at 36 percent. Casamigos, a leading tequila brand, accounted for nearly 13 percent of national sales.

Combs’ attorney, on Sept. 29, highlighted that while Diageo claims to have listened to Combs’ concerns about race and diversity, they didn’t genuinely understand his issues, leading to the current legal battle.