(Courtesy Modelo)

This is the second time that Anheuser-Busch InBev, has gone after the rival company that controls its Mexican beer brands in the US…

Here’s the deal…

When AB InBev, the world’s largest brewer took full control of Grupo Modelo in 2013, it was obliged by US antitrust regulators to sell the Mexican company’s business in the US to Constellation Brands.

That deal has proven to be a goldmine for the Victor, NY beverage and spirits company who now brew and distribute popular Mexican brands like Corona, Modelo and Pacifico in the United States.

But even though Constellation controls production and distribution of those Mexican beers in the US, AB InBev still retains rights to these brands.

Constellation’s business has been transformed by the booming sales of the Mexican beer brands and it even has grabbed some 10% of the US hard seltzer market with its new Corona Hard Seltzer line.

(Courtesy Modelo)

But extending the Corona brand into hard seltzers was a bridge too far for AB InBev, the world’s largest brewer, a company no doubt still stung by having to sell its US control of Grupo Modelo to Constellation Brands.

“In February, AB InBev began court proceedings claiming that that the 2013 deal refers only to beer, not to other lines such as alcohol flavored waters.” According to the Drinks Business,“AB InBev itself is investing more than US$1 billion in production facilities for its own hard seltzer products including those based on its iconic Budweiser brand.”

And now the Mexican arm of Anheuser-Busch InBev is taking Constellation to court again.

On August 31, Grupo Modelo filed a suit in a New York district court over Constellation’s launch of two Modelo Reserva beers, one finished with aged wood from tequila barrels and another with wood from Bourbon barrels.

According to the suit the Tequila Modelo variation breaches US and Mexican laws that strictly limit the use of the word Tequila and the bourbon barrel aged Modelo variation, breaches Constellation’s sub-license to sell “Mexican-style beer” because Bourbon has nothing to do with Mexico.

Who knows how this lawsuit will play out, but one thing’s for sure, these companies are not friends and things have already gotten ugly.