The Sad Saga of Uncle Nearest Whiskey May Come to a Head on Monday

 

The Uncle Nearest home place in Shelbyville, Tennessee.

Uncle Nearest is a brand of American whiskey that launched about a decade ago. Started from nothing, it did very well, but now it’s in trouble.

A hearing on Monday at the federal courthouse in Knoxville may decide its fate.

In the beginning, there was a New York Times article by Clay Risen, headlined “Jack Daniel’s Embraces a Hidden Ingredient, Help from a Slave.” The story goes that Fawn Weaver read the article about Nearest Green and began a journey of discovery that led her to found the brand. She hired esteemed actor Jeffrey Wright to star in a promotional film. The History Channel included Nearest Green in its show about the founding of Jack Daniel’s.

The Uncle Nearest product line.

The new brand benefited from the bourbon boom and from its unique appeal to Black drinkers. The whiskey itself was initially acquired on the bulk whiskey market. As the brand became established, and bulk whiskey became pricey because of high demand, the company entered into a production agreement with Tennessee Distilling Group, a contract distiller in Columbia, Tennessee.

That was supposed to be temporary. The Uncle Nearest company bought Sandy Creek, a former horse farm in Shelbyville, Tennessee, about 16 miles from where Jack Daniel’s is made, as a brand home place. They made many improvements, including buying a still. It was delivered and set up in 2022 but never installed.

Uncle Nearest Founder and CEO Fawn Weaver.

It’s common for a fast-growing company to have some bumps along the way, and Uncle Nearest certainly did. Fawn Weaver became not just the founder and CEO but the living, breathing face of the brand. She made many media and in-store appearances, signing bottles and kibitzing with fans. She was seemingly everywhere. In June of 2024 she released a book, Love and Whiskey, billed as “The remarkable true story of Jack Daniel, his master distiller Nearest Green, and the improbable rise of Uncle Nearest.” She promoted it with a national tour that also promoted Uncle Nearest whiskey.

A year later, the wheels started to come off. Farm Credit Mid-America filed a lawsuit in federal court against Uncle Nearest, Inc., Nearest Green Distillery, Inc., Uncle Nearest Real Estate Holdings, LLC, and Fawn Weaver and Keith Weaver personally for defaulting on over $100M in loans that originated in 2022 and have been in default since 2024.

In September, a receivership was established and the Weavers lost control of the company. The receiver is running it now, supervised by the court. The Weavers, naturally, want the company back. As the receiver has tried to right the ship he has discovered a web of different Weaver-controlled businesses, funded by the Farm Credit loans and Uncle Nearest investors, that were not part of the original lawsuit. In a court hearing scheduled for Monday, February 9th, the receiver will ask the court to expand the receivership to include those entities. At that same hearing, the Weavers will try to end the receivership and regain control.

The Farm Credit loan is secured by the company’s assets. There are also many unsecured debts. Total indebtedness is around $160M. The receiver reports that the company is insolvent. The receiver’s goal continues to be to refinance the debt or sell the company, though he reports that he has not received any viable offers to do either.

Because the Weavers have fought the receivership every step of the way, there have been many filings, claims, and counterclaims flying back and forth. Despite warnings from the court, Fawn Weaver has litigated the case in the media. Every twist and turn has been well documented by several news outlets, so I won’t try to summarize them any further. Both sides will plead their cases and present their evidence and the judge will decide.

Among other things, the receiver predicts that if the court ends the receivership on Monday, Farm Credit will immediately foreclose and begin to liquidate the company’s assets.

So, what are the assets and how much are they worth? There is real estate, in Tennessee, Massachusetts, and France. It includes all the improvements on those properties. 

According to AcreValue, the going rate for farmland in Bedford County, Tennessee is $15,040 per acre and Sandy Creek is 270 acres. The Massachusetts property is a house, listed for $2.25M. It’s unclear what the property in France includes, but it is identified in documents as a “Cognac Chateau.” At a minimum, that should mean real estate, some buildings, and aging stock. It may or may not include a distillery.

In addition to real estate, there is whiskey, in barrels and bottles. At this point, the youngest whisky in barrels is 2 years old, and most of the inventory is less than 4 years old. They produced regularly until December 2023, so each month the inventory of 4-year-olds increases and the inventory of immature whiskey decreases, unless they resume production. The aging stock is about 56,000 barrels. The cost, as new make, was $673 per barrel.

The potentially most valuable asset is also the most volatile one, the intellectual property, specifically the Uncle Nearest brand. Depending how all this goes, it could be worth millions or nothing. Fawn Weaver seems to believe there is no Uncle Nearest brand without Fawn Weaver, and that may be the thing she is most wrong about.

In addition to losing her company, Fawn Weaver faces a sexual harassment lawsuit in New York (Menos v. Uncle Nearest Inc. et al) that was filed in 2022 and has survived several attempts to make it go away. It is scheduled for trial in July.

I predict the hearing on Monday will be brief. The judge will grant everything the receiver wants, in particular control of the other entities. One naturally wonders what Weaver will do next but that’s increasingly irrelevant. Unless she pulls $160M out of a hat, there is nothing she can do.