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Tuesday, May 24, 2022

A New York court rules that a $600 million lawsuit against the cannabis producer can be pursued

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SYRACUSE (TNS) — A $600 million lawsuit against multinational corporation Acreage Holdings will proceed with Acreage Holdings and others following a New York State Supreme Court ruling against the defendants’ request to be dismissed.

The lawsuit against Acreage — one of the 10 registered medical cannabis operators in New York — and nearly 30 other defendants alleges that the company was involved in a scheme to illegally get a partner out of a medical marijuana license.

Judge Andrea Masley, who ruled on Friday, began hearing arguments in January about whether plaintiffs David Vader and EPMMNY, LLC, had the authority to prosecute Acreage and the other defendants.

“It’s a pretrial evidentiary hearing about whether Mr. Vader has the ability to pursue the case, and the judge has determined that he did just that,” said attorney Lawrence Lonergan, who is representing Vader. “We are very pleased that the court saw things our way.”

The case may also complicate Canopy Growth of Ontario, Canada,’s plan to acquire Acreage — a deal worth about $843 million, according to Motley Fool, which covers the financial industry. Canopy is also called the defendant in the lawsuit.

In addition to Acreage Holdings, the lawsuit names as representatives of the defendants of New Amsterdam Distributors, LLC, New York Canna, Inc. Former WCNY President and CEO Robert Dyno.

The lawsuit centers on a company that Dixie, DuVal and Daino initially founded around 2013 called NYCanna, which was later acquired by Acreage Holdings, and details a number of mergers, acquisitions and other transactions in the company’s history.

The lawsuit was originally filed in November 2018, with the EPMMNY lawsuit playing an instrumental role in obtaining the medical marijuana license under which Acreage currently operates, and that the defendants breached a contract of ownership, management and control of the commercial license.

The amended 230-page complaint filed in October seeks $200 million — the amount the plaintiffs claim the license is worth — plus $400 million in punitive damages and license control.

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