The decline in consumer demand for alcohol and distilled spirits since the end of the Covid-19 pandemic, exacerbated by rising labor and product costs driven by inflation, has resulted in several distilleries filing for bankruptcy to reorganize their businesses.
Stoli USA, which distills vodka and other spirits, was the most significant distillery to file bankruptcy in the last year as it on Nov. 27, 2024, filed for Chapter 11 protection after financial distress led to a default on $78 million in secured debt owed to Fifth Third Bank NA.
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The vodka distiller not only dealt with a decline in demand, increased operating costs, and a lending dispute with the bank, Stoli said a severe data breach and ransomware attack in August 2024 contributed to its decision to file for bankruptcy.
Related: Popular whiskey brand files for Chapter 11 bankruptcy
Craft spirits producer Boston Harbor Distillery, which makes whiskey, rum, gin, liqueurs, and distilled beer, on March 31, 2025, filed for Chapter 11 bankruptcy protection, seeking to reorganize its business.
The Dorchester, Mass.-based distiller was established in 2012 by Samuel Adams brewer Boston Beer Company’s co-founder Rhonda Kallman, a leader in the craft beverage industry.
Boston Harbor Distillery’s products include Putnam New England Whiskey, Demon Seed Whiskey, Lawley’s Small Batch Gin, Lawley’s New England Rum, Pre-Batched Craft Cocktails, Boston Harbor Cream & Coffee Liqueurs, and Spirit of Boston Distilled Samuel Adams beer.
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Westward Whiskey files for bankruptcy reorganization
Finally, the parent company of popular high-end whiskey brand Westward Whiskey filed for Chapter 11 bankruptcy to reorganize its business, facing significant liquidity challenges.
Related: Another huge home improvement company files Chapter 11 bankruptcy
The Portland, Ore.-based whiskey maker’s parent, House Spirits Distillery LLC, filed its Subchapter V petition on April 6 in the U.S. Bankruptcy Court for the District of Delaware, listing $1 million to $10 million in assets and debts.
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The debtor’s largest unsecured creditors include Wine Co., owed $101,000; Travelers Insurance, owed over $43,000; and U.S. Alcohol and Tobacco Tax and Trade Bureau, owed over $34,000.
House Spirits Distillery reported a $9.8 million loss on $3.44 million in sales in 2024.
The debtor filed its petition facing financial distress brought on by the decline in demand for alcohol and spirits following the Covid-19 pandemic, overproduction of its whiskeys as a result of a buildup of inventory, overcapacity of its distillery facilities after investing heavily in production capacity, and increased costs and inflation from the overall global economy, according to a declaration from company CEO Thomas Mooney.
The debtor filed its Chapter 11 petition to seek a plan of reorganization and preserve the company as a going concern. It has not filed a motion seeking debtor-in-possession financing.
House Spirits Distillery launched in 2004 to produce and sell premium single-malt whiskeys, using craft ale, Scottish single-malt, and bourbon traditions. The company released its first whiskey through single-cask bottlings in 2012.
Westward Whiskey wins double gold medal
The company expanded across the U.S. in 2018, and its 2020 Westward Cask Strength Whiskey won its first double gold medal at the San Francisco World Spirits Competition.
Westward distills four whiskeys: its American original Westward Whiskey, priced at $74.95 per bottle; Westward Whiskey Pinot Noir Cask, priced at $89.95; Westward Whiskey Stout Cask, priced at $89.95; and Westward Whiskey Cask Strength, priced at $99.95.
Westward Whiskey also has an exclusive club release for members, its Fort George Brewery Stout Cask, priced at $99.95. The distiller’s Westward Whiskey Milestone Edition No. 2, which is priced at $249.95, is sold out.
Related: Huge auto parts brand files for bankruptcy liquidation
