REGIONAL NEWS | By Tabitha Evans Moore | Editor
SHELYVILLE, Tenn. — A new filing in the ongoing federal court case involving Nearest Green Distillery and lender Farm Credit Mid-America asks the court to terminate the receivership overseeing the company and halt any sale-related activity – arguing that the circumstances used to justify the extraordinary step no longer exist.
In a motion filed the day before Christmas Eve in the U.S. District Court for the Eastern District of Tennessee, Uncle Nearest co-founders Fawn Weaver and Keith Weaver, along with Grant Sidney, Inc. – the company’s largest shareholder – ask the court to reconsider its earlier orders appointing a receiver and to return control of the company to its board.
The motion argues that the receiver’s own findings undermine Farm Credit’s original claims of insolvency, inadequate collateral, and fraud. According to the filing, the receiver has determined that Uncle Nearest remains solvent, that the value of its assets exceeds its outstanding debt, and that there is no evidence the founders or current management engaged in financial misconduct.
The court appointed a receiver in August after Farm Credit alleged defaults on loan agreements and raised concerns about the company’s financial condition. At the time, the court emphasized that receivership was an extraordinary remedy and should last only so long as necessary. The new motion leans heavily on that language, asserting that a “material change in circumstances” now warrants dissolving the receivership altogether.
Among the key claims in the filing:
- Solvency: The receiver’s quarterly report found Uncle Nearest to be a viable going concern with enterprise value exceeding its debts.
- No fraud findings: The receiver reported no evidence of misappropriation or financial impropriety by the founders or current employees.
- Collateral adequacy: Barrel counts have been reconciled, and Farm Credit is now described as fully secured.
- Operational harm: The motion alleges that sales volume declined sharply after the receivership began, citing Nielsen retail data showing a reversal from pre-receivership growth to sustained declines afterward.
- Brand risk: The filing argues that uncertainty created by a potential forced sale has harmed distributor confidence and retailer commitments.
The motion also asks the court to temporarily block the receiver from sharing proprietary business information with potential buyers or third parties. According to the filing, the receiver has retained an investment bank to explore refinancing or a sale of assets, which the company says risks exposing sensitive competitive information in a still-unresolved case.
Additionally, the filing disputes Farm Credit’s earlier allegations surrounding the purchase of a Martha’s Vineyard property, asserting that the lender was fully informed of the transaction structure and that the property was never pledged as loan collateral. The motion contends those claims were factually incorrect and contributed to public and reputational harm to the company and its founders.
If granted, the motion would return operational control of Uncle Nearest to its board, maintain the litigation stay during a transition period, and allow the company to assert defenses and counterclaims against Farm Credit that have been effectively frozen during the receivership.
Why It Matters
This case isn’t just about a dispute between a lender and a distillery — it’s about who controls the future of a major Tennessee brand while the lawsuit is still unresolved.
Receivership is considered an extraordinary legal remedy, typically used when a company is insolvent or assets are at imminent risk. In this filing, Uncle Nearest’s owners argue that the very findings produced during the receivership now contradict the reasons it was imposed in the first place.
Farm Credit has not yet filed a response to the motion. Because the motion requests reversal of prior orders and a temporary halt to information sharing, the court may schedule a hearing to evaluate whether circumstances have materially changed since August. The court has not set a hearing date.
In short: this filing does not end the case, but it could fundamentally change who gets to steer the company while the case plays out.•
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