A high-stakes dispute has erupted inside the family behind the estimated $11 billion Jack Daniel’s fortune, with two outspoken brothers challenging their relatives over the direction of the company that owns the iconic Tennessee whiskey brand.
WL Lyons Brown III and Stuart R Brown escalated the tensions in a sharply worded July 10 letter to family members, taking aim at Brown-Forman’s leadership and pressing relatives to seriously weigh a $15 billion takeover offer, according to the Wall Street Journal.
The brothers, who are heirs to the whiskey dynasty but currently sit outside the company’s day-to-day operations, accused Brown-Forman’s board of “rewarding failure, and doing so lavishly and publicly.”
In their letter, they pointed to a string of setbacks, including declining share prices, weakening sales and an unsuccessful merger effort involving French drinks giant Pernod Ricard, the world’s second-largest wine and spirits producer.
They also faulted the board for turning down an unsolicited $15 billion acquisition proposal from Sazerac, the Kentucky-based bourbon company.
The Browns singled out CEO Lawson Whiting as well, alleging he had overseen a “three-year track record defined by poor operating performance, failed transactions, and significant increases in personal compensation.” Whiting has since said he plans to leave the chief executive post.
WL Lyons Brown III and Stuart R Brown are the sons of former Brown-Forman CEO and chairman WL Lyons “Lee” Brown Jr. Both men once had roles within the family-controlled spirits business, though neither is presently involved in running the company.
According to the WSJ, Lyons Brown’s earlier stint at Brown-Forman ended after friction with a previous chief executive over his unorthodox approach, including an episode in which he flipped an organizational chart upside down during a sales meeting, among other attention-grabbing moves.
The $11 billion Jack Daniels fortune is controlled by the Brown family. Three generations of Browns are seen together in Louisville, Kentucky in 1937
Brothers WL Lyons Brown III, left, and Stuart R Brown, right, are locked in a bitter feud with other members of their family. The pair sent a scathing letter to their relatives on July 10 criticizing Brown-Forman’s business operations
He went on to set up a rival liquor company and a now-shuttered honey production business.
Brown-Forman was founded in Louisville in 1870 by pharmaceutical salesman George Garvin Brown. His family now has about 180 living descendants, including spouses.
The company acquired the Jack Daniel Distillery in 1956.
George Brown’s descendants control the publicly traded company through more than 70 percent of its voting Class A shares.
The family established the Wolf Pen Branch, an investment vehicle created to ensure family members voted their shares in unison, in 2017.
Wolf Pen controls about 60 percent of the voting shares itself.
Lyons and Stuart Brown never joined Wolf Pen, meaning they have limited voting power. But that has not made the rebel brothers shy away from voicing their opinion.
They have accused their relatives of failing stakeholders year after year since 2023.
‘The numbers are stark and undeniable,’ the pair wrote, according to the WSJ.
Brown-Forman was founded in Louisville in 1870 by pharmaceutical salesman George Garvin Brown, above. His family now has about 180 living descendants, including spouses
The brother’s grandfather, WL Lyons Brown, pictured, became the Chairman of the Board for the Brown-Forman Corporation in 1951
Owsley Brown II, Sara S Sally Brown, WL Lyons Brown, WL Lyons Brown, Jr, Ina Brown Bond, and Martin S Brown pose for a photo outside their family home in 1937
‘Brown-Forman’s stock price has fallen from the mid-$70s per share to the mid-$20s per share over the past three years, eliminating billions of dollars of generational wealth for the Brown family and all other shareholders.’
The company laid off 12 percent of its workforce last year and sold its historic cooperage in Louisville, the newspaper reported.
Brown-Forman tried to improve sales by introducing a blackberry flavored version of Jack Daniel’s Tennessee Whiskey, but the attempt reportedly failed.
In their letter, Lyons and Stuart Brown accused Whiting of continuing to collect performance bonuses, despite the company’s stock declining.
Similarly, the board approved millions of dollars in bonuses for executives involved in negotiation talks with Sazerac, even though those talks ‘produced no value for shareholders,’ the letter said.
According to regulatory filings reviewed by Bloomberg, Whiting received a $2.7 million payout. Chief Financial Officer Jim Peters received $3.3 million.
Sazerac’s $15 billion offer was initially rejected in May this year. Sazerac renewed its bid last month and appealed directly to Brown family members.
WL Lyons Brown III and Stuart R Brown called out CEO Lawson Whiting for his alleged ‘three-year track record defined by poor operating performance, failed transactions, and significant increases in personal compensation.’ Whiting subsequently resigned his position
Brown-Forman board chairman and fifth-generation descendant Marshall Farrer, left, told the board that a takeover bid from Kentucky bourbon maker Sazerac was ‘not actionable’ to the dismay of Lyons and Stuart Brown
Old Forester water tower on the roof at the Brown-Forman corporate headquarters in Louisville
A statue of Jack Daniel stands in front of the limestone cave spring at Jack Daniel’s Distillery in Lynchburg, Tennessee
But on July 26, Brown-Forman announced it had once again rejected the offer with board chairman and fifth-generation descendant Marshall Farrer claiming it was ‘not actionable.’
‘Brown‑Forman’s Board and leadership team are confident that the company will continue to deliver long-term growth and shareholder value,’ he said at the time.
‘The company remains focused on executing its strategic plan, including expanding its geographic footprint, building brands that resonate with consumers, and enhancing operational efficiency, while continuing to explore additional opportunities to create sustained value for all shareholders.
‘We are excited about what lies ahead, including the next chapter of leadership.’
Wolf Pen Branch said at the time: ‘We are confident in the strength and competitive position of the business, and believe the company is well-positioned to deliver long-term value for all shareholders.
‘We have concluded that Sazerac’s proposal does not align with this vision for Brown‑Forman’s future.’
In their July 10 letter, the brothers questioned why the board, headed by Farrer, had refused to consider Sazerac’s bid.
‘A Sazerac combination seemingly would have offered the chance to significantly strengthen the company’s position domestically and globally,’ the brothers wrote.
Brown-Forman’s stock price has fallen from the mid-$70s per share to the mid-$20s per share over the past three years
Workers label bottles of Woodford Reserve bourbon whiskey, a Brown-Forman Corporation brand, on the bottling line at the company’s distillery in Versailles, Kentucky
Lyons and Stuart Brown argued the board had a ‘fiduciary duty to evaluate all credible offers for the benefit of shareholders, and that duty requires more from the board.’
Citing that Sazerac was an American company also headquartered in Louisville, the pair further alleged it was a ‘natural cultural and operational fit’ for the brand.
‘If the Pernod Ricard transaction was Plan A, what is Plan B? The Company is in crisis,’ the letter said, further accusing company leadership of failing to provide shareholders with evidence that Brown-Forman is an ‘investment worth holding.’
The brothers urged the board to outline a clear strategy for the path forward, be held accountable for executive pay and improve communication with shareholders.
‘The status quo is unacceptable, and the board will be held accountable for the choices it makes — or fails to make — in the weeks and months ahead,’ the letter said.
Whiting retired three days after the brothers circulated their letter. He reportedly told the board he would step down as CEO once his successor was found.
Our News Outlet has approached Brown-Forman, Sazerac and the brothers for comment.
