In 1998 when Starbucks was looking for a partner to help launch their widely loved coffee beans onto shelves of marketplaces, they entered into a deal with Kraft that was set to end in March 2014.
Back in 1998, no one would have guessed that if you fast-forwarded 13 years that Kraft would have split into two separate companies and Starbucks would be paying half of the company -$2.23 billion dollars in damages and another $527 million inattorney fees.
Should Starbucks have to pay the $2.23 billion for the early termination of the contract if Kraft was mismanaging the products? Kraft Inc. argues that if Starbucks wishes to switch suppliers of their coffee in such a small time frame that the company will not have time to salvage the damage of losing the largest coffeehouse company in the world. Kraft Inc. maintains that there is no proof of any breach of the contract and if Starbucks will not honor the contract until March 2014, Starbucks must compensate Kraft for the damages. With no proof of any breach in the contract Kraft Inc. should be compensated with the damages that will arise from having have to make up the deficits lost from the missing revenue regularly generated from Starbucks products.