A devastating ransomware attack in August 2023 severely disrupted the company’s IT infrastructure, particularly affecting their ERP system and forcing manual operations. Full recovery is not expected until early 2025. The cyber incident prevented financial reporting to lenders, leading to default claims on a $78 million debt.

In July 2023, Russian authorities seized Stoli’s remaining distilleries (valued at $100 million) after designating the company and its founder, Yuri Shefler, as “extremists” due to their support of Ukrainian refugees.

The company faces additional challenges:
– 23-year legal battle with Russian state enterprise over vodka trademarks
– Ongoing dispute stemming from Putin’s 2000 executive order on vodka trademark rights
– Founder Shefler’s exile from Russia in 2002 due to political persecution
– Subsequent asylum in Switzerland and UK citizenship after failed Russian extradition attempts

The combination of the cyberattack’s operational impact and Russian asset seizure ultimately led to the U.S. subsidiaries’ bankruptcy filing.