‘As Dirty as It Goes’: Alcohol Investment Firm CEO Accuses RNDC of Collecting Retail Payments While Suppliers Went Unpaid

The founder and CEO of investment firm InvestBev Capital took to LinkedIn on Wednesday to publicly criticize Republic National Distributing Company (RNDC), alleging the bankrupt alcohol wholesaler continued collecting payments from retailers while failing to pay suppliers in the months leading up to its Chapter 11 filing.

In a video posted to the social media platform, Rosen described what he claims happened before RNDC filed for bankruptcy, calling the alleged practice “as dirty as it goes.”

“If you read the articles that are out there, the one thing that is particularly f–ked up is that RNDC kept placing orders with suppliers to sell to retailers, thus getting paid by the retailer, not paying the supplier,” Rosen said in the video.

According to Rosen, suppliers continued shipping products to RNDC despite concerns about the distributor’s financial condition because they feared losing valuable shelf space at retail stores.

“The supplier has to send the goods to RNDC even though they’re struggling, because they don’t want to lose the shelf placement from the retailer,” he said.

Rosen alleged that retailers would then pay RNDC for the products, but suppliers were left unpaid.

“The retailer then pays RNDC in 30 days. RNDC does not pay the supplier, and RNDC wins,” Rosen said.

He further alleged that the distributor retained those proceeds before ultimately seeking bankruptcy protection.

“Now they’ve got a billion dollars in liabilities, they declare bankruptcy, they’ve kept all the proceeds from the sales they’ve made over the last 12 months, and the supplier’s f–ked,” Rosen said.

Rosen did not provide evidence supporting the allegations in the video, and RNDC has not publicly addressed his specific claims.

RNDC filed for Chapter 11 bankruptcy protection on Sunday after months of layoffs, market exits and brand defections. In its bankruptcy filing, the Atlanta-based distributor reported between $500 million and $1 billion in assets against between $1 billion and $10 billion in liabilities, with more than 100,000 creditors.

Among the largest unsecured creditors listed in the filing are Proximo Spirits, Anheuser-Busch, Pernod Ricard and Gallo.

In announcing the bankruptcy, RNDC said the filing was driven by changing market conditions and an increasingly challenging wholesale environment.

“This decision was not made lightly,” the company said in a statement. “Over time, our industry has evolved, consumer preferences have shifted and the wholesale environment has grown increasingly challenging.”

Rosen concluded his video by urging suppliers to focus on what he views as the most significant issue surrounding the bankruptcy.

“That’s what the supplier should be talking about,” he said, adding that he was “kind of salty on the whole RNDC thing.”