A California arbitration panel has awarded an investment firm $1.875 million from a major infused-products and concentrates company, Bhang Chocolate.
The two companies’ relationship dates to March 2014 when Mentor Capital, which in recent years has focused on the cannabis sector, announced it had acquired 60% of Bhang for $39 million.
But soon afterward Bhang terminated the deal, leveling breach of contract accusations against Mentor and asserting the company failed to provide it $7.5 million as agreed upon in their contract. Mentor had invested $1.5 million in Bhang by that point. But Bhang didn’t return the money after the deal fell apart.
According to the Mentor press release, Bhang must return the $1.5 million investment made by Mentor, as well as $375,000 in interest. The arbitration panel rejected Bhang’s request for damages, the released added.
Bhang could not be immediately reached for comment. The company has grown significantly in recent years, selling its products in five states, Washington DC, and the Netherlands.
With the rise of adult use cannabis, experts see medical marijuana dominated by two distinct markets.
This has been a long time in coming … a potential marriage on the rocks and then off the cliff. Not surprised Mentor prevailed; now all they need to do is collect.
How does anyone ship much less “sell” a controlled substance over state borders without blatantly violating the RICO Act? This sounds like a case for the DOJ and the DEA because NO one can transport marijuana or products containing such over state lines! The California company obviously used the investors money to expand the illegal operation and “profit” from the unlawful business activities. Uncle Sam needs to stop these for-profit corporate entities from disregarding federal laws which are the law of the land according to the “federal supremacy” clause of our Constitution.
Dave Armstrong
Managing Member of MediMarts
It’s simple Dave, they work with local manufacturers in every state, totally re-creating a supply/distribution network from dust. It’s like how Marley Natural has local growers in every state they sell, it isn’t coming from Jamaica.