Nevada marijuana business faces flurry of financial fraud suits

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CWNevada, one of Nevada’s largest cannabis companies, has been sued for alleged fraud, failure to repay millions of dollars to its lenders and misusing intellectual property.

“While local and national media outlets report on the unprecedented success of Nevada’s regulated marijuana market, CWNevada management has managed to run the business into the ground,’’ claimed a lawsuit filed by Green Pastures Fund, Jakal Investments, Jonathan Fenn and Growth Opportunities. The case was reported by the Las Vegas Review-Journal.

Here’s what you need to know:
  • CWNevada owns at least two cultivation facilities, a processing operation and three dispensaries under the Canopi brand.
  • Six separate lawsuits reportedly have been filed, most of which have been combined into one case.
  • One suit alleges that CWNevada owes $15 million. Some of the plaintiffs have requested access to the company’s financial records, and a court-appointed receiver.

Todd Bice, who is representing CWNevada, denied the allegations.

“At that time, not only is it our intent to debunk the specious claims but to also assert counterclaims,” Bice wrote in an email to the Review-Journal. “The story is not as currently spun and will be vastly different once responses are filed.”

According to the company’s Twitter page, CWNevada had licensing agreements to produce 13 cannabis-infused product brands, including Charlotte’s Web, Medamints, Mountain High Suckers and Wana Brands.

One of the suits, according to the newspaper, alleges that CWNevada used a Wana Brands formula to make a competing product dubbed Scarlet Oilworks gummies.