Cannabis Industry Daily News

Cannabis e-commerce platform I Heart Jane nets $100 million of capital

By MJBizDaily Staff

Jane Technologies, a leading cannabis e-commerce platform, said it raised $100 million of equity to expand its footprint, strengthen existing software and introduce new technologies.

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The California-based company, which does business as I Heart Jane, said in a news release that the funding was led by Honor Ventures, with participation from Third Point Ventures, Gotham Green Partners, L2 Ventures, Delta Emerald Ventures and Artemis Growth Partners.

Jane previously raised $30 million of capital, bringing the total amount of funding to roughly $130 million, according to the release.

More than 2,100 dispensaries in 36 state legal markets participate in Jane’s platform, which enables consumers to browse constantly updated store menus and customer product reviews and to place orders to be picked up.

Jane also expanded outside the U.S. for the first time with its July launch in Canada via cannabis retailer High Tide.

Colorado AG warns of marijuana market ‘disruption’ if US reform isn’t done right

By MJBizDaily Staff

In a wide-ranging letter to members of Congress, Colorado Attorney General Phil Weiser warned there could be “potential resulting disruption” to the existing state-legal marijuana markets if federal legalization isn’t structured carefully.

In particular, Weiser singled out the suggested 25% national marijuana tax rate included in Senate Majority Leader Chuck Schumer’s recently introduced bill, the Cannabis Administration and Opportunity Act.

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Weiser warned that such a high tax rate could cost states valuable tax revenue of their own and force them to chop budgets on social equity programs or for other programs that rely on marijuana taxes.

Weiser also cautioned Congress that a new national marijuana market should be “rolled out in stages” in order to protect small businesses, particularly from being overrun by Big Tobacco.

“If a national market is not rolled-out carefully and in stages, large companies, particularly existing tobacco-focused companies, will be able to move into new markets immediately, displacing and pushing out smaller players,” Weiser wrote.

“Many cannabis companies are small and/or minority-owned; without phased implementation, we are concerned these businesses will be pushed out of the market thus diminishing the social equity principles behind any federal market rollout.”

FBI investigating Nevada cannabis business licensing process, report says

By MJBizDaily Staff

Federal agents have been scrutinizing the Nevada cannabis licensing process to determine if any corruption was involved in the awarding of business permits.

According to the Las Vegas Review-Journal, FBI agents have been speaking with Nevada marijuana industry executives for at least a year.

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The investigation is focused on potential “pay-to-play” situations that might have arisen since the state legalized recreational cannabis in 2016, the newspaper reported.

One former state lawmaker, Chad Christensen, who co-owns Pisos dispensary in Las Vegas, told the Review-Journal he spoke with FBI agents for roughly 45 minutes last December about his suspicions of corruption during the licensing process.

The newspaper cited two other anonymous industry sources who reported similar conversations with FBI agents, who asked “whether bribes or campaign contributions were used to influence the distribution of cannabis licenses.”

In addition, the Nevada attorney general’s office was notified in February 2020 of a joint investigation being run by the state Department of Public Safety and federal authorities.

The federal probe could be fueled by an ongoing legal battle over 64 marijuana business licenses that were awarded in 2018 to 17 businesses from a pool of 127 applicants, the Review-Journal reported.

In 2019, Nevada Gov. Steve Sisolak appointed a task force to “root out corruption or criminal influences” in the state’s marijuana industry.

New York governor vows to make adult-use marijuana a priority

By MJBizDaily Staff

New York Gov. Kathy Hochul, who took over this week for embattled Andrew Cuomo, pledged to move forward with the state’s multibillion-dollar adult-use marijuana program as quickly as possible.

“Nominating and confirming individuals with diverse experiences and subject-matter expertise, who are representative of communities from across the state, to the Cannabis Control Board is a priority for Gov. Hochul,” the new governor’s spokesman, Jordan Bennett, told The New York Post.

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But it’s unclear how quickly Hochul can narrow the increasing gap between New York and rival New Jersey, which last week released a set of initial rules for its recreational cannabis program.

Hochul will need the state Senate to confirm the key appointment of chair of the Cannabis Control Board, and the Legislature currently isn’t in session.

Hochul expressed her intent to move forward with the cannabis board appointments in a discussion with legislative leaders this week, and the issue will be part of a private meeting next week with Senate Majority Leader Andrea Stewart-Cousins, the Post reported.

Cuomo signed recreational marijuana legislation into law in late March but failed to move the program forward.

The New York market had been expected to launch as soon as spring 2022, but that timeline is likely to slip, according to experts.

Further delays especially will hurt small businesses and entrepreneurs, who must be careful not to make real estate and other financial commitments too soon, industry officials said.

Financial experts said that any fast-tracking done by New York likely would be in allowing existing medical cannabis operators to transition first to adult use.

But nine of the 10 are multistate operators, which could put smaller businesses at a disadvantage and undermine the state’s commitment to develop a diverse industry.

The recreational marijuana law states an ambitious goal of issuing 50% of all adult-use business licenses to social and economic equity applicants.

Tilt Holdings to partner with New York tribe to build cannabis company

By MJBizDaily Staff

Massachusetts-based Tilt Holdings and the Shinnecock Indian Nation on Long Island, New York, are partnering to create a vertically integrated cannabis company.

Through a joint venture with the tribe’s cannabis project development firm, Conor Green, marijuana tech firm Tilt will finance, build and provide management services for the operation, according to a news release.

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A Tilt subsidiary bought all the “Class A units” of Standard Farms New York, which will hold a 75% interest in the Conor Green joint venture.

The Tilt subsidiary paid approximately $700,000 in cash and stock and, according to Forbes, “up to $2.65 million will be paid in additional shares priced at the time of closing, contingent upon certain milestones, like commencement of retail and wholesale cannabis sales.”

The marijuana company formed by the joint venture will be called Little Beach Harvest. The company will be wholly owned by the Shinnecock Nation and will be built on territory in the Hamptons.

Tilt plans to provide management services to Little Beach Harvest for the development of the facilities, including planning, design and funding of up to approximately $18 million in capital expenditures.

Several Native American communities in New York are jumping into the cannabis sector and could be the first to sell recreational marijuana in the state.

Aurora sends first shipment of ‘free’ marijuana to France

By MJBizDaily Staff

A subsidiary of Edmonton, Alberta-based Aurora Cannabis delivered its initial shipment of medical marijuana to France for use in the country’s pilot program, the company announced Wednesday.

The program is reportedly set to start serving medical cannabis to patients at no charge in the coming weeks.

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Aurora was among companies from Australia, Canada, Israel and the United Kingdom chosen to provide products, in partnership with French pharmaceutical distributors, for up to 3,000 patients.

The medical marijuana is being supplied by participating companies at their own cost, and neither the government nor patients will have to pay for it.

“The first prescriptions of dried medical cannabis as part of the French pilot program are a significant step toward providing access to patients and will support the destigmatization of medical cannabis in France,” Aurora CEO Miguel Martin said in a statement.

The company’s Danish subsidiary, Aurora Nordic, is producing the dried flower. It will be transported to France via Aurora’s European distribution hub in Berlin.

The dried flower will be administered with vaporizers by Storz & Bickel, a subsidiary of Canada’s Canopy Growth.

France is among a handful of European nations experimenting with medical marijuana distribution by launching temporary pilot programs.

Though some cannabis producers often tout potential future windfalls in such European markets, not all pilots have gone smoothly.

Denmark’s program experienced strong patient uptake early on, but patient access collapsed to fewer than 500 people – about half the program’s peak two years ago.

Experts have warned it will likely be many years before Europe’s regulated medical marijuana industry, which is already hypercompetitive, sees meaningful revenue opportunities.

For instance, Germany imported only 9,231 kilograms (20,351 pounds) of cannabis flower for pharmacy dispensing last year – less than the 14,463 kilograms of cannabis reimbursed for Canada’s veterans that year.

Some of France’s other suppliers include:

  • Australia-based Little Green Pharma.
  • Canada-based Tilray.
  • Israel-based Panaxia.

Companies were also chosen as potential substitutes.

Shares of Aurora trade as ACB on the Toronto Stock Exchange and the Nasdaq.

Cresco Labs invests $40 million to triple Ohio cannabis production capacity

By MJBizDaily Staff

Chicago-based multistate operator Cresco Labs is investing $40 million to expand a cannabis cultivation and processing facility in Ohio, a fast-growing medical marijuana state with adult-use legalization on the horizon.

Cresco’s project, which has been approved by local authorities, will nearly triple the size of its facility in Yellow Springs, which is part of the Dayton metro area.

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The project will consist of two buildings, according to the Dayton Business Journal, including a 24,000-square-foot processing facility and a 71,000-square-foot facility used mainly for cultivation.

“We really felt that now was the time to not only reinvest in the facility but to double down on Yellow Springs,” Christian Ficara, vice president of government affairs for Cresco Labs, told the publication.

The 2021 MJBizFactbook projects that Ohio’s medical marijuana market will grow more than 50% this year to sales of $350 million-$425 million.

Adult-use legalization also could occur within the next couple of years.

Democratic state lawmakers introduced a bill in late July to legalize recreational marijuana, but key Republican lawmakers are opposed.

The best bet for adult-use legalization could come through a referendum that is expected to be on the ballot in fall 2022.

Idaho high court overturns law that may have hindered marijuana measures

By MJBizDaily Staff

The Idaho Supreme Court overturned a new law that would have made it harder for independent campaigns to get their own ballot measures before voters, including a potential medical marijuana legalization question.

According to the Associated Press, the state’s high court rejected the law and found that it undermined the rights of Idaho voters.

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The law, signed by the governor in April, required any proposed ballot measure campaign to gather at least 6% of signatures to qualify for the ballot from each of the state’s 35 legislative districts. The previous law required signatures from only 18 districts.

Critics said that the Republican authors of the law were attempting to make it harder for campaigns – such as a move to legalize MMJ in 2022 – to actually get measures on the ballot.

The state Supreme Court’s ruling found that the new law effectively gave each district “veto power” over proposed new laws.

But the court’s ruling means that the former law is now back in effect for all statewide ballot campaigns.

All types of cannabis remain illegal in Idaho, but the Legislature this year also killed a separate anti-MMJ legalization measure.

Judge orders New Mexico to lift medical cannabis purchase restrictions

By MJBizDaily Staff

A New Mexico state district court judge ordered that purchase limits for medical cannabis patients should be increased to conform with the new recreational marijuana law approved by lawmakers this year, a move that could result in a sales boom for dispensaries.

According to the Santa Fe New Mexican, District Court Judge Benjamin Chavez issued a writ on Friday directing state officials to allow registered MMJ patients – including the plaintiff in the case, Jason Barker – to buy up to 2 ounces of marijuana per day.

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That total is the legal purchase limit set by New Mexico’s new adult-use marijuana law signed by the governor in April.

That’s a significant increase over the previous limit under the state’s MMJ program – 8 ounces every 90 days.

The state health department and the Regulation and Licensing Department now must reply in court to the judge’s order – which stems from the lawsuit Barker filed in May – or comply with the writ.

Spokespeople for both agencies declined to comment to the Santa Fe New Mexican.

Recreational marijuana sales are not expected to begin until next year.

In the meantime, the judge’s order could mean a big increase in sales for the state’s dispensaries if the registered 120,000 patients will be able to purchase up to 2 ounces a day.

US Supreme Court passes – again – on hearing IRS marijuana lawsuits

By MJBizDaily Staff

The U.S. Supreme Court confirmed for a second time that it will not enter the legal fray between a number of marijuana businesses and the IRS.

According to Law360, the nation’s highest court again declined to hear appeals from Standing Akimbo and Eric Speidell, who owns The Green Solution and other marijuana businesses, in a long-running fight over the impact Section 280E of the federal tax code has on the cannabis sector.

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The Colorado plaintiffs had attempted to persuade the justices that their cases were worth hearing in the wake of:

  • Justice Clarence Thomas’ comments in June that federal marijuana prohibition “may no longer be necessary.”
  • Allegations that the IRS had retaliated against the plaintiffs with additional tax assessments.

Standing Akimbo tried to argue that the IRS had no right to the company’s state tax records during the course of a federal tax audit.

Speidell tried to convince the courts that the IRS didn’t have the legal authority to determine if The Green Solution’s operations were prohibited under federal law and the Controlled Substances Act.

Both cases were attempts at overturning 280E, the federal tax provision that bars marijuana businesses from claiming standard tax deductions.

The cases now appear to be at an end, after both plaintiffs lost at the 10th Circuit Court of Appeals last year and have now been denied hearings twice by the U.S. Supreme Court, Law360 reported.

Schwazze buys indoor cannabis cultivation company for $6.7 million

By MJBizDaily Staff

Continuing a string of acquisitions, Colorado-based Schwazze signed a deal to purchase Denver indoor cannabis cultivation company Brow 2 for $6.7 million.

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The deal includes a 37,000-square-foot building with 27,000 square feet of canopy, according to a news release.

The grow will provide product directly to Colorado retail chain Star Buds, which Schwazze acquired in March.

In July, Schwazze bought a 34-acre marijuana grow in southern Colorado for $11.3 million.

“The new facility will supply our growing network of dispensaries and customers with a broad assortment of high-quality indoor flower,” Justin Dye, Schwazze’s CEO, said in the release.

Schwazze, formerly known as Medicine Man Technologies, trades on the over-the-counter markets as SHWZ.

Canadian firm invests $20 million in Michigan ancillary marijuana company

By MJBizDaily Staff

Toronto-based Sol Global Investments entered the Michigan medical marijuana market through a $20 million investment in a company that provides financing and support services to MMJ operators in the state.

Sol, a diversified investment and private equity firm that also targets high-growth marijuana markets, said it acquired 1.4 million units of Common C Holdings, a Michigan-based limited partnership.

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Common C, which was formed in 2018, provides financing, real estate support, intellectual property licensing work and professional services such as accounting to licensed marijuana operators in Michigan.

“We reviewed a number of Michigan opportunities over the last 24 months knowing it was a state we wanted to be in,” Sol Global CEO Andy DeFrancesco said in a news release.

“Common C Holdings is the perfect fit for our portfolio.”

Sol also has a stake in the Illinois-based multistate operator Verano Holdings and an indirect interest in Chicago-based Cresco Labs, among other cannabis-related holdings, according to regulatory filings.

Sol Global trades on the Canadian Securities Exchange as SOL.