Next month, a judge will hand down a decision on the receivership of Uncle Nearest and Nearest Green, a legal saga triggered when a lender argued that the company helmed by Fawn Weaver had defaulted on $100 million in debt.
The Weavers, Fawn and her husband, Keith, want control back from the court-appointed receivership. In contrast, the receivership seeks to expand its scope to several Weaver-owned properties to bring the company to a healthier financial standing.
After a seven-hour hearing in court earlier this month, things appeared to be smooth between the Weavers and Phillip Young, their court-appointed receiver. But on Thursday (Feb. 26), Young filed a motion alleging that one of the Weavers’ businesses, Grant Sidney, was used in an attempt to hide assets from creditor Farm Credit, including $20 million in loans that Fawn Weaver allegedly signed for, according to the Lexington Herald Leader.
Young stated that records of close to 500 money transfers between Uncle Nearest and various company accounts reveal a serious mix of funds, and that all of them were being run as a single business and should be handled that way under the receivership. Despite U.S. District Judge Charles E. Atchley Jr. ordering the Weavers to turn over all of their bank records, they had not, according to Young, as two new bank accounts had been discovered.
One of the main items the receiver wants to unload from the Weaver’s hands? A house on Martha’s Vineyard that the two bought with Farm Credit money. According to an emergency motion filed by Young, the house has received multiple full-asking-price offers and is a financial liability because it does not generate revenue for the company and has an elevated maintenance cost. Other Weaver-owned properties are due to be auctioned off following a separate bank foreclosure, including a warehouse reportedly used by the distillery to store inventory.
In previous filings, Young and Farm Credit stated that the company, widely known for its popular bourbon, was insolvent, owed upward of $220 million, and had not filed any tax returns since 2018.
The Weavers filed briefs countering Young’s claims, remaining adamant that the company is solvent and that the receiver “has yet to find evidence constituting fraud by current management.” They remain steadfast in their belief that being in a receivership has been the main reason for their decline in sales and that each of their controlled businesses is completely separate from Uncle Nearest and should not be party to the receivership.
However, in briefs filed Friday, the Weavers fired back, reiterating that the company is solvent and that the receiver “has yet to find evidence constituting fraud by current management,” and blaming the receiver for Uncle Nearest’s decline in retail sales. They also filed briefs stating that each of the Weaver-controlled businesses is separate from Uncle Nearest and should not be consumed by the receivership.
A decision on the receivership is expected in March.
