The legal battle surrounding whiskey brand Uncle Nearest has intensified weeks before a federal judge is expected to rule on its court-ordered receivership, with new allegations involving $20 million in loans and disputed asset transfers.
Last summer, a Kentucky court placed Uncle Nearest and its related entity, Nearest Green, into receivership after lender Farm Credit argued the company had defaulted on approximately $100 million in debt.
According to TheGrio, the move temporarily stripped founders Fawn Weaver and Keith Weaver of direct control over the company’s operations.
A decision on whether the company should return to the Weavers’ full control is expected in March.
New $20 Million Allegation
In a motion filed Feb. 26, court-appointed receiver Phillip Young alleged that one of the Weavers’ affiliated businesses, Grant Sidney, was used in an attempt to shield assets from Farm Credit, including $20 million in loans that Fawn Weaver allegedly signed for, according to court filings first reported by the Lexington Herald-Leader.
Young’s filing claims that nearly 500 money transfers between Uncle Nearest and related accounts demonstrate a “serious mix of funds,” arguing that the entities were effectively operated as a single business and should therefore be treated that way under the receivership.
He also stated that despite an order from U.S. District Judge Charles E. Atchley Jr. requiring the Weavers to turn over all bank records, two additional accounts were discovered that had not been previously disclosed.
Property Sales at Issue
Among the assets Young seeks to liquidate is a Martha’s Vineyard home reportedly purchased with Farm Credit funds. In an emergency motion, the receiver argued the property has received multiple full-asking-price offers and is a financial liability because it generates no revenue while carrying high maintenance costs.
Other Weaver-owned properties are also slated for auction following a separate foreclosure action, including a warehouse said to have been used by the distillery to store inventory.
Dispute Over Solvency
In earlier filings, Young and Farm Credit contended that Uncle Nearest is insolvent, owes more than $220 million, and has not filed tax returns since 2018.
The Weavers have strongly disputed those claims, maintaining that the company remains solvent and that no evidence of fraud has been uncovered by the receiver.
In briefs filed late last month, the couple reiterated that the receiver “has yet to find evidence constituting fraud by current management” and argued that being placed in receivership has directly contributed to declining retail sales.
They also insist that their other controlled businesses are legally distinct from Uncle Nearest and should not be absorbed into the receivership process.
Awaiting a March Decision
The case has drawn attention within the spirits industry, where Uncle Nearest has been widely recognized for its premium bourbon offerings and for highlighting the legacy of Nearest Green, the formerly enslaved distiller who taught Jack Daniel his craft.
With a ruling expected this March, the court’s decision could determine whether the Weavers regain operational control or whether the receivership expands its authority over additional assets tied to the couple’s business holdings.
