Ousted co-founders sue leaders of marijuana tech company Dutchie

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The co-founders of marijuana e-commerce platform Dutchie, whom the company said stepped down earlier this month, are suing the current leadership, claiming they’re the victims of a conspiracy to remove them.

According to Law360, Ross and Zachary Lipson – the brothers in 2017 founded Bend, Oregon-based Courier Plus, which does business as Dutchie – filed a lawsuit Dec 7 in Delaware’s Chancery Court against Executive Chair Timothy Barash and board directors Karan Wadhera, Wilder Ramsey, Gaurav Ahuja and Thomas Linovitz.

The Lipson brothers claim in the suit that:

  • A “blatant ambush” at a Nov. 28 board meeting led to their removal from their posts and the board “for cause.”
  • The defendants changed company voting agreements so Barash could become CEO.

The complaint seeks an order from a judge declaring that the brothers’ removal was unlawful and that Ross Lipson is still CEO, Zachary Lipson is still chief product officer and they both remain board directors.

Wadhera is a managing partner at Casa Verde Capital, and Ahuja is a partner at Thrive Capital.

Barash, a former chief financial officer at Toast, a restaurant payments technology platform, became Dutchie’s executive chair after a $200 million Series C round in March 2021.

The defendants have not filed a response to the initial complaint, according to court records.

Dutchie claims to be the biggest provider of e-commerce services to cannabis stores, with more than 5,000 retail clients and $14 billion in annual sales processed.

The company was valued at $3.75 billion after a $350 million raise in a Series D round in October 2021.

Dutchie has raised $603 million in capital to date from investors such as Casa Verde, Thrive, rapper Snoop Dogg and former Starbucks CEO Howard Schultz.

The company recently laid off 67 employees, about 8% of its workforce, after what Ross Lipson called a “dramatic market shift.”