Verano accused in lawsuit of illegal interstate marijuana trafficking

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Illinois-based multistate operator Verano Holdings is accused in a lawsuit of illegally shuttling marijuana from its home state to Arkansas.

According to the Chicago Sun-Times, the allegations of illegal interstate marijuana shipments stem from cannabis MSO Harvest Health & Recreation’s attempted acquisition of Verano, a deal that fell through in March 2020.

The lawsuit, filed Monday in Colorado District Court, targets dozens of cannabis executives and companies, including Verano CEO George Archos.

The plaintiff in the suit, Nicholas Nielsen, is a former employee of Natural State Wellness Enterprises in Arkansas who was arrested in January 2020 for illegally growing marijuana at his home.

When Nielsen was arrested, Natural State was being managed by Harvest, and separate lawsuits filed against Harvest alleged that Nielsen was growing the marijuana on Harvest’s behalf. Nielsen reiterated the claim in the new lawsuit.

According to the Sun-Times, Nielsen’s suit further claims that:

  • Verano was the source of the cannabis clippings from which he grew the plants at his home.
  • The clippings were delivered to Nielsen by Michael Frontier, a Verano employee who was indicted in 2019 in connection with an illegal gambling ring.

In a statement to the Sun-Times, a Verano spokesman called the allegations in the lawsuit “totally false and absurd” and said the suit is a collection of “sensationalized and imagined series of events.”

A Harvest spokesperson also pushed back, saying the suit is “replete with inaccuracies” and is “nothing more than a thinly veiled shakedown” by Nielsen and his attorney.

Nielsen, who is facing multiple felony criminal charges in Arkansas, has told law enforcement officials that he “would definitely testify against” Frontier, Verano and his former supervisors at Harvest. He alleges his former Harvest supervisors told him it was legal for him to grow the plants at his home.

Verano trades on the Canadian Securities Exchange (CSE) under the ticker symbol VRNO and on the U.S. over-the-counter markets as VRNOF.

Harvest trades on the CSE as HARV and as HRVSF on the American OTC markets.

– John Schroyer