Iconic Craft Brewery Ballast Point At Risk of Collapse Amid Lawsuits, Fraud Accusations

(Photo: Ballast Point)

Ballast Point, the prolific San Diego craft brewery once valued at $1 billion, has been hit with a pair of lawsuits warning of an imminent “operational collapse.” The civil complaints set the stage for an embittered legal battle within the brewer’s executive team as various parties accuse one another of fraud, rogue leadership and reputational harm.

The lawsuits allege that William Trzos, majority stakeholder of Ballast Point owner Kings & Convicts Holding Co., took out $3 million in loans without the approval or knowledge of fellow board members. One of the filings claims that Trzos “diverted the entirety of the loan proceeds to his own personal benefit,” leaving Kings & Convicts with millions of dollars in unauthorized obligations and garnished bank accounts.

Plaintiffs say that Trzos remained “silent and disclosed nothing” when they confronted him about the loans in February 2026. The lawsuit speculates that there may be additional, yet-undiscovered unauthorized transactions, and requests an immediate court-ordered disclosure of his financial dealings at the company.

Trzos is one of five board members of Kings & Convicts, of which he owns a 55% stake.

In a rebuttal filed at the end of last month, Trzos’ lawyers told a drastically different version of events, claiming that the true purpose of the litigation is to force him into an unfavorable buyout of his majority interest. Trzos says that he signed personal guarantees for the loan obligations and claims to have already paid off approximately $2 million, though plaintiffs add that they’ve yet to be provided proof.

Elsewhere in the filing, lawyers claim that Trzos has been denied access to the company’s books and records, effectively barring him from the leadership group. In his absence, the board is said to have fallen into a state of “governance paralysis,” impairing its ability to “respond to market opportunities, manage business risks, and make strategic decisions.”

The story of Ballast Point has been fraught with highs and lows since its founding in 1996. Originally popularized by its best-selling Sculpin IPA, Ballast Point witnessed a rapid ascent in the California craft beer scene and was at one point pegged as the 17th largest brewer in the US.

Its growth did not go unnoticed. In 2015, Corona Beer owner Constellation Brands bought the brewery for $1 billion, at the time the largest single acquisition of an individual craft beer brand. Two years later, Ballast Point’s distillery business was spun off into a new company, Cutwater Spirits, which was eventually purchased by Anheuser-Busch and turned into a market leader of its own.

Under Constellation Brands’ ownership, Ballast Point suffered a near-total implosion. The brewer lost roughly 90% of its financial value and over half of its beer production volume in four years, teeing up a fire sale to Kings & Convicts in 2019.

The San Diego Superior Court judge overseeing the case has reportedly met with both the plaintiffs and defendants, and has scheduled a hearing on August 14th to determine if a mediation can be settled.