Uncle Nearest receiver asks judge for gag order against founder Fawn Weaver
AI-generated summary reviewed by our newsroom.
- Receiver asks judge to bar Weaver, her husband from discussing receivership.
- Receiver ties Weaver’s bankruptcy posts to an employee resignation and delayed deals.
- Receiver seeks $75,000 in sanctions and expansion to include seven Weaver entities.
The receiver attempting to keep the trouble Uncle Nearest whiskey and bourbon brand afloat is asking the federal judge to issue a gag order on founder Fawn Weaver.
The receiver made the unusual request in addition to reiterating his previous request for financial sanctions against Weaver after she filed bankruptcy, a move later dismissed as improper. Weaver has filed an intent to appeal the bankruptcy decision.
In a filing late Monday, receiver Phillip Young told U.S. District Judge Charles E. Atchley Jr. that Weaver’s communications last week about filing for bankruptcy caused considerable confusion — so much so that one distillery employee quit because of the “whiplash.”
Young said the court “should enjoin Fawn Weaver from speaking about this proceeding,” after she issued a press release “declaring that this receivership case was concluded,” and published a six-minute social media video saying she was again in control of her company.
Weaver has not been in control of Uncle Nearest or the Nearest Green Distillery since last fall, when the receiver was appointed by the court at the behest of Kentucky lender Farm Credit Mid-America, which sued Fawn and Keith Weaver and the company, alleging they had defaulted on more than $100 million in loans.
Fawn Weaver has asked Atchley to remove the receiver, whom she blames for slipping sales. The receiver has asked to expand the receivership to include at least seven Weaver-controlled business entities, including Grant Sidney, which is at the heart of disputed $20 million loan from Jay-Z’s venture capital firm, MarcyPen. The receiver is attempting to sell a house on Martha’s Vineyard and other distillery assets to cover more than $200 million in debts for the business, which he and Farm Credit say is insolvent.
Weaver caused ‘widespread confusion’
Fawn Weaver also caused confusion by telling employees the company had declared bankruptcy, according to the receiver.
“She also sent a text message to all Uncle Nearest employees sharing the same message — and then sent another text message to all employees announcing that she had appealed the Bankruptcy Court’s dismissal of her unauthorized bankruptcy filings,” the receiver said in his filing.
“The result ... has been widespread confusion,” he said in the filing. He said that he’d heard from employees, creditors, vendors, shareholders, distributors and potential asset purchasers asking for clarifications.
“At least two potential asset purchasers emailed the receiver asking for confirmation that he would be able to deliver title to property, one of whom ‘put on hold’ their work on this transaction as a direct result of Ms. Weaver’s actions,” according to the filing.
Five senior Uncle Nearest employees “expressed confusion regarding whose directions they were to take. One of these employees resigned, citing the ‘whiplash’ caused by the filings,” according to the filing.
Additionally, payment from distributors has been delayed, he said.
Receiver wants new gag order on Weavers, Grant Sidney
“This has to stop. The confusion created around the company since the autumn by Ms. Weaver’s filings and her social media communications has cost this receivership countless hours and hundreds of thousands of dollars,” the receiver said in the filing. “More importantly, she has significantly damaged the brand by these actions.”
He asked for a gag order in addition to the previously requested monetary sanctions of $75,000.
“Specifically, the receiver requests that the Court enjoin Ms. Weaver, Mr. Weaver, and Grant Sidney (Fawn Weaver’s business entity) from discussing this receivership action and/or anything related to this receivership action (including alleged bankruptcy filings) publicly, on social media, with employees, with vendors, with creditors, with shareholders, with investors, and with distributors,” the receiver said in his filing. “An order of this magnitude is the only thing that will allow the Receiver to complete the tasks that this Court has appointed him to accomplish.”
