Starbucks Owes Kraft $2.75 Billion

Tastes burned.
Tastes burned. Photo: Starbucks

An arbitrator determined yesterday that Starbucks must pay $2.75 billion to Kraft in an expensive end to a three-year dispute that validates Kraft’s claims that Starbucks breached contract when it ended the companies’ partnership selling packaged coffee in stores. Starbucks still maintains that Kraft mismanaged its brand, citing all the money they made after dropping the company as proof, but the arbitration is final, leaving the coffee behemoth no choice but to use all that money to pay off Mondelez International, which spun off Kraft last fall. While this ends one dispute, a cultural war of a kind is brewing in India, where the growing popularity of Starbucks is cause for concern among the traditional chai wallahs, who vend on the street. Indians are falling for the convenience of air-conditioned and Wi-Fi-enabled coffee shops, but the government doesn’t like where this trend is heading, and is considering naming tea the national beverage to stave off the imminent macchiato invasion. [USAT, ABC]