Cannabis giant Harvest Health seeks to terminate acquisition

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Harvest Health & Recreation, an Arizona-based multistate marijuana operator, on Wednesday said it has filed a federal lawsuit against Falcon International seeking to terminate its merger agreement with the California-based company.

As part of the suit, Harvest also is seeking a return of $50 million it paid to Falcon under the merger agreement.

Harvest’s complaint, filed in U.S. District Court in Arizona, alleges that Falcon failed to meet its legal obligations, including failing to provide auditable financial records to Harvest.

In a statement, Harvest said it remains committed to the “long-term potential of legal cannabis sales in California,” but, in the current market, it is “difficult to operate profitably there today.”

Earlier this week, Harvest said it plans to pay $87.5 million for Interurban Capital Group in Seattle.

Interurban is the owner and operator of Seattle-based Have a Heart, which has a total of 11 dispensaries in California, Washington state and Iowa. The company also has licenses for seven marijuana retail sites in California.