Vintage bourbon retailer settles Kentucky case, to pay fine, forfeit bottles

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Vintage bourbon seller Justins’ House of Bourbon has agreed to pay a $25,000 fine and forfeit 120 bottles of bourbon and other whiskeys to the Kentucky Department of Alcoholic Beverage Control to settle the long-running case that involved three raids and the seizure of hundreds of bottles of Blanton’s, Weller and vintage distilled spirits.

“The Department of Alcoholic Beverage Control is pleased to have reached a settlement agreement that includes the licensee paying a fine and forfeiting certain alcoholic beverages to resolve the pending administrative action,” said Kristin Voskuhl, spokeswoman for the Kentucky Public Protection Cabinet, the parent agency of Kentucky ABC.

As part of the June 12 settlement of the 18-month, high-profile case, Kentucky ABC will allow Justins’ House of Bourbon to receive a new Vintage Distilled Spirits retailer license without admitting fault to any of the nine violations of spirits law that the state had alleged occurred.

The state and Justins’ submitted a joint motion to dismiss a restraining order in place in Franklin Circuit Court that had prevented Justins’ from selling any of the contested bottles.

Franklin Circuit Judge Thomas D. Wingate signed the agreed order on June 20, clearing the way for all but four of the remaining 500-plus bottles to go back on shelves.

As part of the settlement, Justins’ agreed to drop a lawsuit and all claims against Kentucky ABC once it receives its new license. Justins’ has until July 15 to pay its civil penalty in lieu of possible license suspension.

In the lawsuit, Justins’ House of Bourbon had accused ABC of damaging its vintage bottles, including some said to be “near-priceless”; ABC had denied that allegation.

As part of the June 12 agreement, Justins’ House of Bourbon will drop that claim.

The parties must bear their own legal costs.

Justins’ House of Bourbon responds to settlement

Justins’ House of Bourbon, owned by Justin Thompson and Justin Sloan, with Lexington developer Lee Greer as a silent partner, released a statement saying there had been “a resolution” without alluding to the details of the settlement.

“To all our customers, colleagues, friends, and family, your unwavering support over the last 18 months has been humbling. Faced with the most challenging of times, we drew strength from our community, finding the resolve needed to defend our good name and our industry. As small business owners, we felt compelled to champion for our collective rights and equitable existence,” the owners said.

“With a resolution behind us, we can now move forward with a clear conscience, knowing that our patience and silence amid false narratives and hollow reporting was ultimately rewarded with justice.”

Lingering issues in JHOB lawsuit

Greer has filed a motion to intervene in the Franklin Circuit Court lawsuit to request vintage bottles he says are his property be returned directly to him rather than turned over to Thompson and Sloan for potential sale. Wingate ordered that the four bottles, including a rare Pappy Van Winkle family release signed by Julian Van Winkle, remain at the store for now.

A hearing is scheduled for June 24 on Greer’s motion to intervene to get his bottles back. It’s unclear what action ABC might take on the matter.

What Justins’ House of Bourbon forfeited in deal

In the settlement, Justins’ agreed to forfeit to Kentucky ABC 90 bottles “for which JHOB failed to produce proper paperwork demonstrating their provenance” and another 30 bottles “that JHOB purchased from individuals who sold to JHOB more than 24 bottles within 365 days,” according to the settlement.

The excess purchase bottles include a dozen bottles of Eagle Rare purchased from one seller, six 1.75-liter bottles of Weller Special Reserve purchased from one seller, three 1.75-liter bottles of Weller purchased from one seller, two bottles of Wild Turkey 12 Year Old bourbon purchased from one seller, and other individual bottles purchased over the limit of 24 bottles in a year, according to the settlement.

The bottles forfeited for lack of provenance include bottles of Weller Special Reserve and Blanton’s, as well as limited editions of Maker’s Mark, Willett, Michter’s, Four Roses, E.H. Taylor, Old Forester, Angel’s Envy and various vintage labels.

Vintage spirits sales in Kentucky changed

Following stories in 2023 by the Herald-Leader on loopholes in the vintage spirits sales law, Kentucky’s General Assembly this year amended the vintage distilled spirits exemption to put tighter controls on purchases from individuals. The move is designed to cut down on sales of rare, hard-to-find but not old bourbons.

As part of the reform, the legislature also passed language to allow Kentucky ABC to sell any bottles that are forfeited after legal action is over.

What will happen to the 120 bottles that Justins’ House of Bourbon forfeited?

“Following the passage of HB439, auctioning retained distilled spirits is an option for the ABC once a final order is issued and all appeals have been exhausted. Any auction proceeds benefit the Alcohol Wellness and Responsibility Education (AWARE) Board,” Voskuhl said in a statement.

How the Justins’ House of Bourbon case began

Justins’ House of Bourbon opened in 2018 in the wake of the passage of Kentucky’s Vintage Distilled Spirits law that allows private citizens to sell bottles to retailers. Justin’s opened a store in Lexington at 601 W. Main St. and another in Louisville at at 101 West Market St. Both stores specialize in vintage and hard-to-find whiskeys.

On Jan. 17, 2023, ABC agents in Kentucky raided Justins’ House of Bourbon stores in Lexington and Louisville, while alcohol enforcement agents in Washington, D.C., raided the warehouse of their BourbonOutfitter.com shipping business in D.C.

The D.C. agents seized hundreds of bottles including whole boxes of Blanton’s brought in from overseas as well as Weller and other expensive and much sought-after bourbons.

Kentucky agents seized 640 bottles of whiskey and other spirits, allegedly worth more than $2 million, at the Justins’ stores in Lexington and Louisville.

At the time, the raids made waves throughout the bourbon world; vintage bottle collectors and tourists frequently included stops at the stores while visiting Kentucky distillers.

The Kentucky case involved “complaints alleging several violations associated with Justins’ House of Bourbon for the improper acquisition, possession, transport, and sale of bourbon, including Vintage Distilled Spirits,” according to ABC comments at the time.

In D.C., Justins’ House of Bourbon faced 11 code violations including illegally transporting alcohol into the district and unlawfully obtaining product from outside the U.S.

The D.C. case file, obtained by the Herald-Leader under open-records laws, said that Sazerac, which makes Blanton’s, Weller and other premium bourbons at its Buffalo Trace Distillery in Frankfort, told federal investigators the company had been dealing with a widespread counterfeit of their product and that it was originating from the Netherlands. A federal investigator, who said an agent already was working in Kentucky on counterfeit Sazerac bourbons, told D.C. alcohol officials: “Sazerac product is more lucrative than heroin right now.”

Justins’ House of Bourbon paid fines in D.C. case, sued Kentucky ABC

In May 2023, the D.C. case was settled; Justins’ admitted to two violations involving record-keeping and agreed to pay fines of $3,000.

In July 2023, Thompson and Sloan (but not Greer) sued Kentucky ABC in Franklin Circuit Court, trying to get the case dropped. But in August 2023, Kentucky ABC charged Justins’ House of Bourbon with nine counts of administrative violations including illegally transporting bottles between its two Kentucky stores, illegally shipping bottles in and out of the state, failure to report vintage distilled spirits purchases to the state and failure to place a sticker on vintage bottles to indicate they were from the secondary market.

In September 2023, Wingate ordered all of 640 bottles seized in Kentucky returned to Justins’ Lexington store for safekeeping but ordered that they not be sold or displayed. The move came after ABC reported that there had been a water leak at its storage building.

In April 2024, Justins’ House of Bourbon applied for the newly required $300 supplementary license to sell vintage distilled spirits ahead of the May 1 deadline. They were told that ABC’s administrator “is awaiting the resolution of your administrative case (to take away Justins’ license) before taking action on your pending application.”

Justins’ sought and received from Wingate an emergency restraining order that allowed the retailer to sell vintage spirits over the lucrative Kentucky Derby weekend despite not having a newly required license.

Without a vintage license, Justins’ House of Bourbon would close, the owners said at the time.

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