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Thread: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

  1. #1
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    Default Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Big amount.
    Because Starbucks is big, it is not fatal. Just a bad bruise.
    Mondelez International Inc., which spun off Kraft Foods Group in October 2012, will get the money.

    Starbucks had a renegotiated contract with Kraft in 2004, where Kraft would market Starbucks roasted and grounded coffee in stores from 2004 to 2014. But in 2010 Starbucks terminated the contract. Kraft sued for breach.

    So why?
    No one wants to lose such a big sum. US$2.23 billion in damages and US$527 million in (Kraft's) attorney fees.
    The lawyers are the winners - imagine earning US$527 million in 3 years.
    Oh, the sum that Starbucks must pay its own lawyers is not known - maybe another US$500 Million.

    • If Starbucks wanted to terminate the contract like that, it should have built up its case until it is bullet proof with lots of strong evidence that Kraft is in the wrong and deserves to have the contract terminated.

    • Maybe Starbucks was poorly advised and the inner circle or consultants told the CEO what he wanted to hear before they did what they did.

    • Even if Starbucks was not happy, it could have sat out the remaining 4 years till 2014, let the contract expire and then never have anything to do with Kraft again.

    So what's the impact?

    • Some has to pay for this >>> You. Coffee may be more expensive? Don't know yet.

    • Is it good for Kraft / Mondelez ? NO. It is bad repute. Though they got the money, other business partners will be wary of them. They may not get new deals with good business partners for a long time.
    Last edited by ricohflex; 13th November 2013 at 10:09 PM.

  2. #2

    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Quote Originally Posted by ricohflex View Post

    • Some has to pay for this >>> You. Coffee may be more expensive? Don't know yet.
    You should only go there when someone else is paying the bill
    I eats, shoots & leaves

  3. #3

    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Coffee in those fancy cafe is already expensive anyway due to exorbitant rental price
    You can do uncles and aunties in hawker center a favor with $1 coffee

  4. #4

    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Quote Originally Posted by ricohflex View Post
    Big amount.
    Because Starbucks is big, it is not fatal. Just a bad bruise.
    Mondelez International Inc., which spun off Kraft Foods Group in October 2012, will get the money.

    Starbucks had a renegotiated contract with Kraft in 2004, where Kraft would market Starbucks roasted and grounded coffee in stores from 2004 to 2014. But in 2010 Starbucks terminated the contract. Kraft sued for breach.

    So why?
    No one wants to lose such a big sum. US$2.23 billion in damages and US$527 million in (Kraft's) attorney fees.
    The lawyers are the winners - imagine earning US$527 million in 3 years.
    Oh, the sum that Starbucks must pay its own lawyers is not known - maybe another US$500 Million.

    • If Starbucks wanted to terminate the contract like that, it should have built up its case until it is bullet proof with lots of strong evidence that Kraft is in the wrong and deserves to have the contract terminated.

    • Maybe Starbucks was poorly advised and the inner circle or consultants told the CEO what he wanted to hear before they did what they did.

    • Even if Starbucks was not happy, it could have sat out the remaining 4 years till 2014, let the contract expire and then never have anything to do with Kraft again.

    So what's the impact?

    • Some has to pay for this >>> You. Coffee may be more expensive? Don't know yet.

    • Is it good for Kraft / Mondelez ? NO. It is bad repute. Though they got the money, other business partners will be wary of them. They may not get new deals with good business partners for a long time.
    Did you stardee very hard to become a lawyer? I wish I did!
    宁愿遇见丢失幼崽的母熊,也不愿碰上做蠢事的愚人

  5. #5

    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    oh man, Kei is one of the shareholder in starbucks....
    Objection !!!

  6. #6

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    Quote Originally Posted by ninelives View Post
    oh man, Kei is one of the shareholder in starbucks....
    What?? I'm just a lowly barista!

  7. #7

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    Quote Originally Posted by ninelives View Post
    oh man, Kei is one of the shareholder in starbucks....
    She is Howard Schultz's gf

  8. #8
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    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Perhaps in June 2013, Starbucks sensed that the outcome was not going to be in their favour.
    Hence:
    http://online.wsj.com/news/articles/...59553701906588



    What is the take-away lesson from this?

    If Starbucks is going to pay US$527 Million to the opposing party's lawyers if the latter wins, and perhaps another US$500 Million to pay Starbuck's own lawyers, in addition to $2.23 Billion damages.......

    then fight it out in a law court.



    Don't opt for arbitration.



    Based on the rules of binding arbitration, Starbucks cannot appeal the decision.

    Arbitration is only seemingly nice (oh, they don't sue each other in Court, they choose the less combative sounding arbitration).

    The outcome (US$2.76 Billion loss in this case) is anything but nice.
    Last edited by ricohflex; 14th November 2013 at 10:45 PM.

  9. #9
    Member Foxshade's Avatar
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    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Just ask Kei to go to Kraft board meeting and do strip tease. Confirm they'll drop the case....
    Fear is the best weapon....
    A true photograph need not be explained, nor can it be contained in words.
    ~Ansel Adams

  10. #10

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    Quote Originally Posted by Foxshade View Post
    Just ask Kei to go to Kraft board meeting and do strip tease. Confirm they'll drop the case....
    Fear is the best weapon....
    Whattttttt

  11. #11
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    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Quote Originally Posted by Foxshade View Post
    Just ask Kei to go to Kraft board meeting and do strip tease. Confirm they'll drop the case....
    Fear is the best weapon....
    LOL.....just like ancient china emperor sending a princess to a foreign land?

  12. #12
    Moderator keithwee's Avatar
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    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    no wonder today i saw Starbucks "giving away" an organizer with every $120 purchase of its stored value card =.= ......

  13. #13

    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Quote Originally Posted by Foxshade View Post
    Just ask Kei to go to Kraft board meeting and do strip tease. Confirm they'll drop the case....
    Fear is the best weapon....
    Fear ????

    using long armpit hair ???

    I eats, shoots & leaves

  14. #14

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    Quote Originally Posted by keithwee View Post
    no wonder today i saw Starbucks "giving away" an organizer with every $120 purchase of its stored value card =.= ......
    It's been around for about a month

  15. #15
    Senior Member Sion's Avatar
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    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Quote Originally Posted by ninelives View Post
    oh man, Kei is one of the shareholder in starbucks....
    For every dollar you spend in Starbucks 1 cent goes into her bra.

  16. #16

    Default Re: Starbucks must pay US$2.76 billion to settle a dispute with Kraft

    Quote Originally Posted by Sion View Post
    For every dollar you spend in Starbucks 1 cent goes into her bra.
    That would be a gigantic bra

    I eats, shoots & leaves

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