Why Snoop Dogg and Master P say Walmart and Post 'sabotaged the success of Snoop Cereal' in new lawsuit

By Lukas I. Alpert

The rappers say the two companies conspired to push their cereal line out of business by letting it go stale in storerooms rather than placing it on shelves

It was a cereal conspiracy.

Rappers Snoop Dogg and Master P have accused Walmart Inc. and cereal giant Post Consumer Brands of using "diabolical actions" to drive their upstart brand, Snoop Cereal, out of business.

The two men say their company, Broadus Foods, partnered with Post - one of the biggest producers of cereal in the U.S. - in 2022 to manufacture and distribute a line of breakfast cereals in retail outlets around the country, according to a lawsuit filed in a court in Minnesota.

But rather than working to make sure the Broadus Foods cereals were made available to consumers, the suit says Post (POST) conspired with its largest retail partner, Walmart (WMT), to keep the products off shelves, instead leaving them sitting in storerooms.

Snoop Dogg and Master P said they came up with the idea for a line of cereal products in order to leave a sustainable business behind for their families and to create a minority-owned product in an underrepresented market.

The suit says Post originally offered to buy the idea for the cereal line outright when the rappers initially approached the company, but Snoop Dogg and Master P insisted on a 50/50 partnership. The suit says Post agreed but then only went through the motions of creating the brand in order to stifle it before it could take off.

"Post entered a false arrangement where they could choke Broadus Foods out of the market, thereby preventing Snoop Cereal from being sold or produced by any competitor," the suit read. "Broadus Foods brings this suit to take a stand against the defendants for their diabolical actions."

Both companies denied working to push the rappers' cereal line out of business and blamed its failure on poor sales.

"Post Consumer Brands was excited to partner with Broadus Foods, and we made substantial investments in the business," Post said in a statement. "We were equally disappointed that consumer demand did not meet expectations."

Walmart said it valued its "relationships with our suppliers, and we have a strong history of supporting entrepreneurs," but that "many factors affect the sales of any given product, including consumer demand, seasonality, and price, to name a few."

In the lawsuit, the rappers said that when the products first arrived in stores in July 2023, they were a hit with consumers, but that the boxes of Snoop Cereal and Momma Snoop syrup, oatmeal and pancake mixes soon disappeared from shelves, particularly at Walmart.

The suit pointed to online posts from shoppers who said that when they asked about the cereal at Walmart stores, the stores' computer systems would say it was out of stock, but that store workers would then discover hundreds of boxes sitting in storerooms.

The men said the cereal line was meant to be affordably priced, but that when it was available in stores, it was often for sale at inflated prices of over $10 a box.

The suit said that Post and Walmart typically had very specific agreements for the exact placement on shelves of their products - a practice known as slotting contracts, for which manufacturers typically pay a fee - with codes assigned to each product noting exactly where it should be placed in stores.

But for Snoop Cereals, the suit claims, Walmart assigned the boxes a code denoting "no location," meaning they would not ever be placed on shelves.

"This case shines a light on the steep challenges faced by minority-owned businesses in securing fair opportunities in the marketplace," Snoop Dogg and Master P's attorney, Ben Crump, said in a statement. "If this is how celebrities like Snoop Dogg and Master P are treated by corporate America, just imagine how lesser known Black entrepreneurs and small-business owners are treated by powerful corporations."

-Lukas I. Alpert

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02-07-24 1414ET

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