How a $3 million deal between two Phoenix breweries fell apart | Phoenix New Times


How the $3 million Helton, Head Right Brewing purchase fell apart

When Head Right’s offer to buy Helton Brewing collapsed, it sued and alleged the brewhouse and business breached the sales contract.
Helton Brewing Co. faced an allegation of breach of contract from a previous potential buyer before the brewhouse and business was sold to another business.
Helton Brewing Co. faced an allegation of breach of contract from a previous potential buyer before the brewhouse and business was sold to another business. Chris Malloy
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Before O.H.S.O. Brewery + Distillery acquired Helton Brewing Co. in August — a move that positions O.H.S.O. to become one of the state’s largest craft brewers — a previous suitor sued over an alleged breach of contract.

Head Right Brewing Co. filed a complaint against Helton Brewing in Maricopa County Superior Court on July 14. The complaint alleged that the actions of owner Brian Helton forced the company to renege on its nearly $3 million offer for Helton Brewing's property on Indian School Road and its equipment. Helton became unresponsive, the lawsuit alleged, preventing Head Right from doing its due diligence.

But, two weeks after Head Right filed an injunction with the court — asking it to order Helton Brewing to reenter its agreement and "consummate" the deal with Head Right and to block the sale of the brewery to others — the two parties reached an undisclosed settlement.

Head Right owner Tom Bobo and Helton declined to comment when reached by phone.

What the lawsuit claimed

In court documents, Head Right alleged that after entering into a sales agreement with Helton Brewing, the seller frequently showed up to meetings “substantially late or failed to show up altogether,” preventing Head Right from doing its due diligence. As a result, Head Right pulled its $150,000 in earnest money on June 23, effectively ending the sales agreement.

However, Head Right still intended to work toward a deal.

“Despite the return of the earnest money, [Head Right] conveyed to [Helton Brewing] that it still intended on going through with the purchase,” the complaint said.

Head Right alleged its team had verbal and written communication with Helton agreeing to reinstate the contract and give Head Right more time to perform its due diligence. However, the amendment to reinstate the contract was never executed, according to Head Right's filing.

Head Right believed that Helton Brewing “intentionally sabotaged” the deal, and Helton Brewing's “broker informed Head Right that they were ‘going to go with the best deal on the table,’” according to Head Right’s court filing.
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Brian Helton sold Helton Brewing Co., which he opened on Indian School Road in 2016.
Sara Crocker

Who is Head Right Brewing Co.?

On its website, Head Right touts four unnamed founders with “over 75 years of combined expertise in the brewery, craft beer, big beer, beverage and business industries.” Bobo is the business owner registered with the Arizona Corporation Commission.

There is no physical address listed on its website other than Phoenix. Online, Head Right also highlights four core beers: a light lager, honey shandy, wheat ale and an IPA.

“Two flagship beers will focus on a craft light lager and a twist on the light lager with our enhanced ‘better for you’ beer, named Head Right Lager,” according to the website. “These two beers will be our target for local and regional distribution.”

Among the items that were part of the Helton Brewing sale were two canning lines.

Head Right ‘canceled the contract’

In Helton Brewing’s response to the complaint on July 28, attorneys pointed out that Head Right terminated the agreement and the $150,000 in earnest money was returned.

“[Head Right] provided a termination notice of the sale to [Helton],” the response reads. “Now, upon learning [Helton] has entered into a contract with a third party for the sale of the same property and business, [Head Right] seeks to ignore the most pertinent fact of all — [Head Right] canceled the contract.”

Helton Brewing included Head Right’s email terminating the sales contract in its filing, and noted that Head Right said it “disapprove[d] of feasibility and suitability of the property” as the reason.

Helton Brewing’s response also asserted that Head Right didn’t claim a breach of contract until after it terminated the contract.

“If Head Right alleged a breach of contract before the termination notice of June 23, 2023 — and it did not — then the contract provided appropriate methods for dealing with such an allegation,” the response said.

By calling foul later, Head Right’s “actions now delay, and potentially jeopardize, the sale of the property to a third party," according to Helton Brewing court filing.

Helton Brewing, Head Right reach settlement

On Aug. 14, Helton Brewing’s attorneys filed notice with the court that a settlement had been reached. Ten days later, both parties asked Superior Court Judge Scott Blaney to dismiss the case.

“The parties hereto, having entered into a mutual and comprehensive settlement agreement, including an agreement to have this action dismissed with prejudice,” the filing stated.

No additional details of the settlement were disclosed with the Aug. 24 court filing. The deal between Helton Brewing and O.H.S.O. was inked the next day, Helton told Phoenix New Times in an earlier interview.
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