BrewDog Founder James Watt Faces Data Privacy Scrutiny Over Takeover Attempt

Founder of BrewDog, James Watt at his home in London ahead of the launch of Social Tip. (Photo: Press Association via AP Images)

James Watt, the embattled founder of BrewDog, has been accused of violating data privacy laws following his bid to buy the company back from an American cannabis firm.

Earlier this week, Watt shocked investors when he announced that he intended to repurchase his multinational brewing chain, which had been sold to the US-based Tilray in March for £33 million (~ USD $44 million). BrewDog had once been valued at close to $1 billion, operating over 100 pubs, four breweries, three hotels and several spin-offs in the vodka and tequila markets. Debt overwhelmed the company in its later years, leading to hundreds of layoffs and a salvage acquisition.

Watt was apparently not dissuaded. The founder has now created a separate venture called Second Best, which he hopes to use to repurchase the entirety of BrewDog.

Part of his plan hinges on so-called “Equity Punks,” a group of around 43,000 investors who purchased shares in the brewing company before its acquisition. When Tilray took over, their equity was rendered null and void. On Wednesday, Watt reportedly reached out to thousands of former Equity Punks, offering them the same shares in his new company, free of charge.

“If successful, everyone who has signed up to Second Best will own the same stake in Brewdog they once held. For free,” Watt wrote in an email seen by BBC Scotland.

Less than two days after his takeover campaign kicked off, Watt may now be facing an investigation over those emails. The Guardian reports that several individuals who received the message were unsure how the BrewDog founder obtained their contact information, raising concerns that he may have violated the UK’S General Data Protection Regulation. The case has reportedly been referred to the Information Commissioner’s Office, which has the power to impose fees if a violation of GDPR is determined.

Marc Knox, a former Equity Punk who considered making a complaint to the ICO, told The Guardian that several ex-investors were ruffled by the surprise message.

“I got the email last Sunday and I kind of laughed. I wasn’t thinking about complaining but I talked to a friend, looked online and saw there were lots of people saying the same thing: ‘How has this joker got my details?’,” Knox told the outlet.

Watt has denied wrongdoing, saying that the emails were sent “using lawfully obtained data, and in connection with their legitimate interests as shareholders.” Whether or not Watt had rights to the data, however, is the subject of debate. Tilray Brands says that it did not purchase the Equity for Punks shareholder data as part of its acquisition, and AlixPartners, the administrator of the remainder of BrewDog, says it did not provide any contacts to Watt.

Under Watt’s leadership, BrewDog was subject to a steady stream of controversies, including allegations of sexual harassment, dropping salaries below the real minimum wage and running ad campaigns mocking trans sex workers. Shortly after the company’s acquisition by Tilray, Watt acknowledged the “many mistakes” he made at the company, adding that he will “always be cheering it on from the sidelines, even if the next chapter is now going to be written by others.”