Ohio medical cannabis chain sues over $19 million loan

Columbus, Ohio (WCMH) — A Florida-based medical marijuana dealer has sued an Ohio grower and pharmacy chain over $19 million in loan defaults.

Truleeve, through its subsidiary Harvest Health and Recreation, filed a lawsuit Thursday against Harvest of Ohio in the Franklin County General Court of Justice. Harvest of Ohio maintains her three pharmacies in Columbus, Athens, Beaver Creek and a growing facility in Ironton.

The complaint revolves around loans received by Harvest of Ohio, which now total nearly $19.5 million, plus $4.3 million in interest. Mr. Trullibe alleges that Harvest of Ohio has yet to repay “one dollar” of the advance payment and instead asked for 16 extensions.

“Mr. Trulive owes $23.8 million and we will exercise our right to recover it,” a Trulive spokesman said in a statement.

According to the complaint, from 2020 to 2021, Harvest of Ohio regularly borrowed from Harvest Health in a “hard-to-finance industry,” and the loans were above cannabis industry standards. Low industry interest rates were set. Branding for the Ohio chain also comes from Harvest Health. Acquired by Trulieve in 2021.

Ohio’s medical cannabis business continues to ask for additional funding even after it has exhausted its credit line, as indicated in an email included with the application.

“I had a call today with members of the Harvest Grows team. They are definitely half glass individuals, but they are near the breaking point in terms of what we still need to be successful. Yes,” said one funding request. Email from Harvest of Ohio Chief Operating Officer, December 14, 2021.

The loan was used to finance nearly all of Harvest of Ohio’s operations, from construction to rents, payroll, licenses and permits, according to the complaint. The lawsuit continues, accusing Harvest of Ohio executives of using some of the loans to pay a “six-figure salary.”

The day before Trulieve filed the lawsuit, he celebrated the opening of Ohio’s first pharmacy facility in Columbus, a 20-minute drive north of Harvest’s pharmacy on High Street.

“HHR (Harvest Health) and Trulieve’s actions undermine the DEI’s pledge to control businesses built by women and people of color, and marginalize women and people of color.” said an emailed statement from Harvest, Ohio. read by a publicist.

Founder and majority owner Arianne Kirkpatrick is black, and when Harvest received its first permit, the state required that members of economically disadvantaged communities be given 15% of medical cannabis licenses. . It was later ruled that the law was unconstitutional.

In a statement, a spokesperson accused Harvest Health of interfering in management decisions and of imposing “improper charges” against Harvest of Ohio.

Trullibe’s lawsuit also alleges that Harvest of Ohio’s failure to comply with financial liability requirements set by state regulators puts its license at risk.

But a spokeswoman for the Ohio Pharmacy Commission, which plays a role in regulating medical marijuana in Ohio, said it had taken no action against Harvest’s approval.

The Pharmacy Commission entered into a settlement agreement with Harvest of Ohio in 2020, and Harvest of Ohio will agreed to donate $500,000 to the state’s substance abuse database The fund was created after the state claimed it improperly received its original license based on a majority-minority ownership structure.

https://www.nbc4i.com/news/local-news/columbus/ohio-chain-of-medical-marijuana-dispensaries-owes-more-than-19-million-in-defaulted-loans-lawsuit-alleges/ Ohio medical cannabis chain sues over $19 million loan

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