Joseph C. Barsalona II Quoted in Law360, “Tanking Demand Kicks Off Bourbon Industry 'Bloodbath”

Joseph C. Barsalona II, partner in the firm’s Bankruptcy, Restructuring & Creditors’ Rights practice, was recently quoted in a Law360 article titled, “Tanking Demand Kicks Off Bourbon Industry 'Bloodbath'.” The article discusses how the bourbon industry is struggling with bankruptcies and major losses as consumers are turning away from traditional liquor. Barsalona, who represents House Spirits in its Delaware Chapter 11 case, told Law360 it has a stalking horse bid for barrels of aged whiskey totaling about $4 million when those same barrels were valued at about $16 million in December 2024.

"It's a bloodbath," Barsalona said. "That's insane, but that is where we are in the market."

"The whiskeys, the bourbons, the other dark liquors, yes, millennials are still drinking them, they were the drink of choice for many of the baby boomers. But if you look at Gen Z or even younger, they're shifting either away from liquor entirely or to THC or other hemp-based products, or they're not drinking at all,” Barsalona said.

Barsalona said that aside from the steep loss in value for his client's whiskey barrels, others are seeing 90% drops for their aging spirits as they explore their strategic options in bankruptcy, in receivership or on the mergers and acquisitions market outside of court.

While consumer preferences have changed on a macro level, whiskey drinkers have not disappeared into the ether and there will remain some demand for aged dark liquors, he said.

"I think it won't be what every American drinks. It will get to be a smaller and smaller populace. Those that love it, love it, and they're not going to give it up. There is still value there, it just won't be at the levels we have seen for decades. That's going to be a tough wake-up call for these companies still in startup mode,” said Barsalona.

To read the full article in Law360, click here.