Miller suffers legal setback in plan to end licensing agreement with Molson Coors

TORONTO - A plan by Miller Brewing Co. to terminate its Canadian licensing agreement with Molson Coors (TSX:TPX.B) (NYSE:TAP) has suffered a legal setback.

Miller says an Ontario court granted a temporary injunction on Thursday that prevents the termination until a trial on the matter scheduled for later this year.

Miller, a subsidiary of SABMiller plc, a multinational with headquarters in the United Kingdom, said it was "disappointed with today's interim court decision" but "remains confident in its position" ahead of the court date.

"While we respect the decision, Miller Brewing Co. looks forward to proceeding to trial, presently set for December 2013," Stephen Rogers, legal counsel for Miller, said in a news release.

"We remain firm in our expectation that the court will agree that we adhered to the terms of our Canadian Licence Agreement when we exercised our right to terminate."

The agreement covers such well-known brands as Millers Genuine Draft, Miller Lite and Miller High Life.

Miller wants to develop the brands in Canada on its own and intended to terminate the agreement with Molson Coors on July 22, saying it had given the required six-month notification.

However, Molson Coors Canada filed suit in Ontario earlier this year to prevent the move, saying its planned on "strongly defending our rights to market and sell'' Miller brands in Canada.

"Molson Coors Canada represents a number of import brands and is proud of the success Miller brands have achieved in Canada under our stewardship for the past 20 years," Peter Nowlan, chief commercial officer for Molson Coors Canada, said in a statement at the time.