The Curious Tale of Russia’s War Over Stoli

By Richard Thomas

When the owners of Kentucky Owl bourbon brand, the Stoli Group, filed for Chapter 11 bankruptcy in late November 2024, an interesting footnote was an example of how an American liquor company can sometimes fall victim to mafia state tactics. Stoli blamed the bankruptcy on a malicious Russian cyberattack, essentially describing the incident as the straw that broke the camel’s back.

The Stoli Group is owned by exiled Russian billionaire and liquor tycoon Yuri Shefler. His difficulties with the Kremlin began with his purchase of the fabled Stolichnaya vodka brand from the state company VVO Soyuzplodoimport in 1997. However, the Russian state soon decided that they didn’t like the idea of Shefler owning the brand, resulting in a string of lawsuits. As the legal machinations went on, Shefler immigrated to Switzerland in 2002. Production of the vodka was relocated to Latvia. The company dropped the name Stolichnaya for the shorter Stoli and did business everywhere but Russia, leaving the actual name Stolichnaya and the Russian market alone. In 2018, Russian courts ordered Shefler to hand over two decades worth of profits from selling Stoli, and in 2021 the Russian Supreme Court ruled the original sale of the brand in 1997 was illegal.

Stoli Group then officially disowned the Russian invasion of Ukraine, making a statement in 2023 that condemned the war and the Putin regime (I would link to the statement, but the Stoli website is defunct). This was not the first time Shefler or his company criticized the Kremlin; in 2013 Shefler openly spoke against Russian anti-LGBTQ laws. This time the Russian state responded by declaring Shefler an anti-national extremist and confiscating all the assets they could get their hands on, namely whatever he still owned in Russia.

That year also marked when Russian hackers targeted Stoli Group. According to company executives, their website and entire office infrastructure was brought down in October 2024. That forced them to conduct all business for the globally marketed vodka brand manually, something the company scrambled to do.

Given that Stoli Group’s assets were perhaps as much as five times larger than their liabilities, I believe seeing the cyberattack as the last straw that drove the company into bankruptcy actually has some credence. There is more to it than merely the idea of having to do some expensive IT contracting; until the damage was made right, company operations went analog and for the first time ever. The office was in no way set up to hand such demands; they had neither the experience, expertise, tools or manpower to do anything more than improvise. It must have been chaos.

Kentucky Owl is a separate case in many ways; observers were long skeptical of the grandiose plans to build a Kentucky Owl bourbon campus in Bardstown. Some influencers have speculated that Kentucky Owl’s big plans left it out on a limb when the Bourbon Boom ended, but it is clear that the bourbon brand did not sink itself or drag Stoli down with it; Stoli sank all on its own and took Kentucky Owl with it. It’s worth remembering that Stoli’s people always maintained at least part of the reason why was the mafia state that is Russia waged lawfare on them for decades, and in the end finally resorted to cyberterrorism.