In January 2009, after an ATF raid led by Jim Cavanaugh of Waco notoriety, Sutton was sentenced to eighteen months in a federal prison for illegally distilling spirits and possession of a firearm as a felon. Sutton, 62 and recently diagnosed with cancer, pleaded with the U.S. District Judge Ronnie Greer to let him serve his sentence under house arrest. Several petitions were made in attempts to reduce or commute Sutton’s sentence, to no avail.

Sutton committed suicide by carbon monoxide poisoning on March 16, 2009, apparently to avoid a federal prison term due to begin a few days later. On October 24, 2009, Sutton’s body was relocated from his original grave site in Mt. Sterling, North Carolina, to his home in Parrottsville, Tennessee, providing an opportunity for the first public memorial service to be held. His body was carried to its new resting spot by horse and carriage. Sutton’s memorial grew in spectacle as country music singer Hank Williams, Jr. flew in to pay his respects. It was a small memorial only for close friends and family.