Joe Ledbetter, left, and Tim Piersant are the founders of Chattanooga Whiskey Co.

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A series of wins by Chattanooga Whiskey came to an end on Wednesday, as the distiller announced the cancellation of its New Year's Eve "Barrel Drop" in downtown Chattanooga.

It would have been the first-ever such celebration in the vein of New York's Ball Drop or Atlanta's Peach Drop, complete with free bands, lots of beverages and a dropping barrel as the clock ticked down to 2014.

There were hotel deals, corporate sponsors and even food trucks. The company had to move the event from the High Point climbing gym on Broad Street to the larger Center Park at the 700 Block of Market Street.

But there were problems. City officials had questions about noise and traffic, and after the Chattanooga Beer & Wrecker Board initially deferred its approval of the Barrel Drop until residents were notified of the party, a group of downtown bar owners met and decided to ask Chattanooga Whiskey not to hold the event at all, several officials said.

The Barrel Drop was finally canceled on Wednesday afternoon.

"Our team started to realize our focus was not solely on our core mission: to bring whiskey back to Chattanooga," the company said in an email signed by all its employees.

But there was another reason, as many of the company's Facebook fans correctly guessed in the minutes after the announcement. Chattanooga Whiskey's series of increasingly successful block parties, which have brought thousands of attendees to downtown events, have been cannibalizing sales at traditional bars and restaurants, some restaurant owners say.

"They were definitely getting in the way of people with brick-and-mortar establishments doing business," said Erik Niel, chef at Easy Bistro. "If you have multiple people try to promote an event, it gets hard for people who are in their own establishment to compete."

Though the barrel drop was designed to bring out-of-town visitors to celebrate in downtown Chattanooga, including its many bars and dining establishment, New Year's Eve really isn't a bar-hopping type of celebration that would have helped out local restaurateurs, Niel said. Instead, celebrants typically find a venue, pay a cover charge and stay in one place for the entire evening.

If that place was the Barrel Drop instead of one of the many restaurants bringing in music acts and offering special deals, some bar owners worried that they could lose money.

For now, Chattanooga Whiskey is halting all its events, which benefit the Tennessee Stillhouse Foundation, until it completes its downtown distillery, a spokesman said.

"We're not going to focus on events, we're going to focus on building this building," said Joe Ledbetter, a company co-founder. "Because that's the greatest event we can have."

But that still leaves Chattanooga residents with nothing to drop on the evening before the New Year, unless they're watching it happen live on TV.

Neal said that bar owners have discussed setting up their own multi-block party similar to Spoleto in Charleston, S.C., which would focus on patronizing existing businesses, but the group hasn't yet figured out a way to make it work.

"There's a groundswell in the community for something like that," he acknowledged. "If there was a block party, a barrel drop that involved people being in our restaurants and in our bars, and that was the only food service, you'd have a lot of people behind you."

-- Contact staff writer Ellis Smith, esmith@timesfreepress.com or 423-757-6315