Just months after media reports hailed Uncle Nearest Premium Whiskey as one of the most successful Black- and woman-owned spirits brands in history, the company now finds itself in a legal and financial storm. Farm Credit Mid-America, PCA, has filed a federal lawsuit against the Shelbyville, Tennessee-based distillery, alleging it has defaulted on more than $100 million in loans, Tullahoma News reported.
The Legal Drama Over Money
The suit, filed in the U.S. District Court Eastern Division of Tennessee on July 28, names Uncle Nearest Inc. and co-founders Fawn and Keith Weaver. The lender is requesting that a court-appointed receiver take control of the company’s assets, warning that its collateral is “in danger of being lost and/or materially injured or impaired” if immediate action isn’t taken.
According to the complaint, Uncle Nearest failed to meet key loan obligations, including making principal and interest payments, and allegedly used loan funds to purchase a $2 million property on Martha’s Vineyard. The suit also claims the company sold off whiskey barrels (which make up the majority of the lender’s collateral) and discounted future revenue streams.
The lawsuit also claims that Uncle Nearest, despite all the media hoopla and praise, has been in default since at least January 2024. The lender writes that the company was unresponsive or delayed in providing updated financials.
Uncle Nearest and its founder/CEO Fawn Weaver have been embraced by media. In fact, In early 2024, Fortune reported the company was “approaching unicorn status,” valued at $900 million after an oversubscribed capital raise.
Founded by Weaver in 2017, Uncle Nearest quickly rose to become the top-selling Black-owned spirits brand, distributed in all 50 states and 12 countries.
On Aug. 1, Uncle Nearest has pushed back, calling the claims of the lawsuit “demonstrably false.” Keith Weaver, who co-founded the award-winning whiskey brand with his wife Fawn, told The Lynchburg Times the suit is riddled with inaccuracies, including the suggestion that the company hasn’t made loan payments in over a year. He also denied allegations that corporate funds were misused to purchase the Martha’s Vineyard estate.
Two court filings submitted Aug. 2 in the Eastern District of Tennessee claim that the company’s former CFO Michael Senzaki acted alone in inflating Uncle Nearest’s whiskey barrel inventory, leading to a $24 million credit boost from Farm Credit Mid-America. The filings label the act as fraud and state that Fawn Weaver and other executives were unaware of the false figures.
In a sworn statement, she says Senzaki was solely responsible for inventory reports and related funding requests. She says the company has launched an internal investigation and is considering legal action against Senzaki.
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