As bourbon booms, thirst for rare brands breeds skullduggery

ANDREW SELSKY and DAMIAN DOVARGANES Associated Press

SALEM, Ore. — Buttery, smooth, oaky. These are characteristics of the best bourbons, and a growing cult of aficionados is willing to pay hundreds or even thousands of dollars to get their hands on scarce American spirits — and even bend or break laws.

The first challenge is figuring out which liquor stores have these premium bottles on their shelves — and that’s where inside knowledge can give bourbon hunters a leg up, and potentially get them into legal trouble.

<p>Seven Grand Bar Manager Evan Roth, left, talks to fellow bartender Roland Gonzalez, tasting bourbon March 1 at the Seven Grand bar, a whiskey bar in downtown Los Angeles.</p>

Damian Dovarganes, Associated Press

Seven Grand Bar Manager Evan Roth, left, talks to fellow bartender Roland Gonzalez, tasting bourbon March 1 at the Seven Grand bar, a whiskey bar in downtown Los Angeles.

In Oregon, several high-ranking officials at the state’s liquor-regulating agency are under criminal investigation after an internal probe found they used their influence to obtain scarce bourbons.

That included the holy grail for bourbon fanatics: Pappy Van Winkle 23-year-old, which can sell for tens of thousands of dollars on resale markets. Top-end bourbons have found themselves at the center of criminal investigations in at least three other states, from Virginia to Pennsylvania to Kentucky.

Premium spirits were always expensive and sought-after, but interest is surging. Distillers have upped production to try to meet increased demand, but before the whiskey reaches stores and bars, it must age for years and even decades.

Each state gets a limited amount of Pappy Van Winkle 23-year-old, produced by Old Rip Van Winkle Distillery of Frankfort, Kentucky.

“The average person cannot get good bottles,” said Cody Walding, a bourbon fan from Houston. He believes he’s years away from finding Buffalo Trace Distillery’s five-bottle Antique Collection, despite making connections with liquor store managers.

“Like, to be able to get Pappy Van Winkle or Buffalo Trace Antique Collection, unless you’re basically best friends with a store manager, I don’t even think it’s possible to get those,” he said. In a Los Angeles bar that Walding visited recently, one shot of Pappy 23-year cost $200.

Six officials from the Oregon Liquor and Cannabis Commission — including then-Executive Director Steve Marks — have acknowledged they had Pappy or another hard-to-get bourbon, Elmer T. Lee Single Barrel, routed to liquor stores for their own purchase. All six denied they resold the bourbons.

Old Rip Van Winkle Distillery’s suggested retail price of Pappy 23-year is $299.99. Because of its extreme scarcity, it can go for a lot more on the resale market.

In December, a single bottle sold at Sotheby’s for a record $52,500. Two other bottles were auctioned for $47,500 apiece. All three were originally released in 2008.

The Oregon agency’s internal investigation determined the employees violated a statute that says public officials cannot use confidential information for personal gain. Gov. Tina Kotek sought Marks’ resignation in February, and he quit. The other five are on paid temporary leave. An investigation by the state Department of Justice’s Criminal Division is ongoing.

<p>Bourbon aficionado Cody Walding from Houston, Texas, tastes a 10-year-old bourbon by Eagle Rare on Feb. 28 at the Seven Grand bar, a whiskey bar in downtown Los Angeles.</p>

Damian Dovarganes, Associated Press

Bourbon aficionado Cody Walding from Houston, Texas, tastes a 10-year-old bourbon by Eagle Rare on Feb. 28 at the Seven Grand bar, a whiskey bar in downtown Los Angeles.

Marks did not immediately respond to messages seeking comment. In his replies to the commission investigator, Marks denied he had violated ethics laws and state policy. However, he acknowledged that he had received preferential treatment “to some extent” in obtaining the whiskey as a commission employee.

The practice was allegedly going on for many years and involved not only state employees but also members of the Oregon Legislature, the investigator was told.

Five bottles of Oregon’s allotment of Pappy 23-year-old went to “chance to purchase,” a lottery started in 2018. The odds of winning Pappy 23-year were 1 in 4,150.

Utah, Virginia and Pennsylvania are among other states with lotteries for coveted liquor. Two men in Pennsylvania each bought a bottle of Pappy Van Winkle after winning the liquor lottery in different years. They tried to sell their bottles on Craigslist, but undercover officers posing as buyers nailed them for selling liquor without a license.

<p>Old Forester Straight Bourbon Whiskey is used to mix Old Fashioned cocktails March 4 at the Seven Grand bar, a whiskey bar in downtown Los Angeles.</p>

Damian Dovarganes, Associated Press

Old Forester Straight Bourbon Whiskey is used to mix Old Fashioned cocktails March 4 at the Seven Grand bar, a whiskey bar in downtown Los Angeles.

In Virginia, an employee of the state’s Alcoholic Beverage Control Authority downloaded confidential information about which state-run liquor shops would be receiving rare bourbons. An accomplice then sold the intel to Facebook groups of bourbon fans. The now-former employee pleaded guilty to felony computer trespass in September, received a suspended prison sentence and a fine, and was banned from all Virginia liquor stores.

In Kentucky, an employee of Buffalo Trace Distillery was arrested in 2015 for stealing bourbon, including Pappy, over several years and selling it. The caper became part of “Heist,” a Netflix miniseries, in 2021.

Whiskey is a booming industry, especially the high-end products.

Supplier sales for American whiskey — which includes bourbon, Tennessee whiskey and rye — rose 10.5% last year, reaching $5.1 billion, according to the Distilled Spirits Council of the United States. Revenue for makers of super-premium American whiskey grew 141% over the past five years.

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