Diageo has won an out-of-court settlement of £9m from Brown-Forman, the US-based maker of Jack Daniel's, in a dispute over the distribution of the whiskey brand in the UK.

B-F, with other brands such as Findlandia vodka and Fetzer wines, ended the deal with Diageo in July 2002 and awarded the contract to distribute Jack Daniel’s and its other brands in the UK to Bacardi.

However, Diageo, the maker of Guinness stout and Smirnoff vodka, wanted to extend the contract to distribute Jack Daniel’s for an additional three years on the back of meeting “performance standards”.

And Diageo claimed damages of £35m-45m for loss of profits it would have earned in the period.

But B-F denied that the standards had been met and sued Diageo for a legal declaration that it was not required to extend the contract.