Whiskey producer Uncle Nearest files Chapter 11; receiver seeks sanctions

Uncle Nearest filed for Chapter 11 bankruptcy on March 17, 2026, while founder and CEO Fawn Weaver challenged lender Farm Credit Mid-America in a separate lawsuit. Court‑appointed receiver Phillip G. Young Jr. moved to dismiss the petitions and is seeking sanctions, pointing to a federal order that gives him sole authority over the company.

Weaver submitted Chapter 11 petitions in the U.S. Bankruptcy Court for the Eastern District of Tennessee, Knoxville Division, for Uncle Nearest, Inc., Nearest Green Distillery Inc., and Uncle Nearest Real Estate Holdings, LLC. She also sued Farm Credit Mid-America in New York state court, alleging the lender spread false claims about the company’s finances and operations. Young responded the same day with an expedited request for sanctions and a bid to throw out the cases, asserting Weaver lacked authority to file.

Young, who was appointed by a federal court to run the business, argued that prior orders reserve all decision‑making for the receiver, including any bankruptcy filing. In a filing to U.S. District Judge Charles E. Atchley Jr., he called the petitions “premature and ill-conceived” and urged the court to impose financial penalties. He wrote that the actions “require immediate and severe sanctions” because they violate court directives and have harmed the companies under receivership.

Weaver maintains the Chapter 11 cases end the receivership and allow the company to keep operating while it pursues claims related to its credit facility. Court papers list approximately $13,188,927 in unsecured obligations. The loan with Farm Credit Mid-America carries a stated principal balance of about $102,521,326, which the company disputes. The filings estimate enterprise assets at roughly $529 million.

The Chapter 11 filings do not automatically restore Weaver’s management authority. Earlier court orders placed Uncle Nearest under receivership and vested operational control with Young, including the power to evaluate any bankruptcy path. Young has notified the bankruptcy court that he is seeking dismissal of the new petitions.

Uncle Nearest entered receivership in August 2025 after Farm Credit Mid-America alleged defaults on roughly $108 million in loans and lines of credit. In court submissions, the lender claimed the company violated loan terms and failed to meet required financial conditions. Filings also alleged Uncle Nearest overstated the value of whiskey inventory pledged as collateral and did not maintain required cash balances.

During the receivership, Young has been preparing to sell non-core assets to raise cash and stabilize the business. Plans outlined in court papers have included marketing French vineyards, a Cognac château, and other real estate. He has indicated that a liquidation or a Chapter 7 filing could be considered depending on asset sales and negotiations with creditors.

The company continues to produce and sell whiskey while proceedings unfold. Weaver’s lawsuit in New York accuses Farm Credit Mid-America of running a smear campaign by circulating false claims about missing inventory, financial misconduct, negative cash flow, and insolvency. “The accusations circulated about us were not only false. The bank knew they were false when they made them, and they knew those accusations would strike directly at the credibility that allowed this brand to grow against all odds in this industry,” Weaver stated in a company release.