A company that says it was part of a team vying for a medical marijuana business license in New York has sued multistate cannabis operator Acreage Holdings and others for $400 million, alleging they reneged on an ownership stake in a lucrative MMJ venture in the Empire State.
The company, New York-based EPMMNY, claims the defendants – which include principals now with the cannabis company Terradiol – conspired to deprive EPMMNY of its 25% equity stake in New York Canna, which now holds one of the state’s prized MMJ licenses.
EPMMNY was formed in 2015 to apply for a New York MMJ license. The team was led by David Feder, a New York-based attorney, and Malcolm Morrison.
The entity was a rough acronym for EdiPure Medical Marijuana New York.
Here are the basics behind the situation:
- The suit was filed this month in New York State Supreme Court.
- EPMMNY is asking for $100 million in damages and $300 million in punitive damages.
- Acreage said it doesn’t comment on pending litigation, and Terradiol didn’t immediately respond.
- The suit claims that High Street Capital Partners, now Acreage Holdings, “has known, or should have known” that EPMMNY owned 25% of New York Canna, when or after it acquired part of the company in late 2016.
The suit goes further, alleging that Acreage’s current control over New York Canna, “one of the crowns of its cannabis business portfolio,” has “wrongfully enabled” the company to raise hundreds of millions of dollars and attract high-profile people to its company.