New court filings this week set ablaze the legal battle between two cannabis companies over a skunked licensing deal.
Ascend Wellness Holdings, a cannabis operator hoping to get its foot in the New York medical marijuana market, doubled down on a lawsuit against MedMen in its attempt to acquire the latter company’s medical marijuana license — one of ten in the state.
Ascend lobbed several barbed accusations against the rival company in a revised complaint filed in state Supreme Court on Monday.
In the amended complaint, which accuses MedMen of being in breach of contract over $73 million worth of licensed operations in New York, Ascend alleges that the real reason MedMen has sought to scuttle deal is because its has “seller’s remorse and hopes to strike a better deal with a new buyer.”
According to the complaint, the two companies brokered a deal for Ascend to buy the state license in February of last year, which required state regulatory approval to be final.
That approval was issued last December, but MedMen has since claimed that it has the right to terminate the deal because the process was not legitimate.
Ascend initially filed suit in January, seeking to force MedMen to turn over its New York operations.
MedMen responded by filing a counterclaim that alleges that Ascend’s CEO Abner Kurtin put political pressure on Governor Kathy Hochul, which resulted in a staff member of the a state cannabis regulator giving the license transfer from MedMen to Ascend final approval.
The governor’s office did not respond to MedMen’s claims by this story’s deadline.
In Ascend’s latest filings, it portrays MedMen as a “broken and mismanaged” company that has lied in its counterclaim. In addition to filing the amended complaint, Ascend moved to dismiss the countersuit.
In that counterclaim, MedMen said that when state regulators initially issued approval for the license transfer on Dec. 16 it wasn’t final.
MedMen claimed that the state Cannabis Control Board, an entity that oversees the licensing process, conditionally approved the license transfer in an email on Dec. 16. On Dec. 28, three days before the deal between the marijuana companies expired, a regulator from the Office of Cannabis Management got in touch to say the approval process might take another 60 days, the lawsuit said. One day later, that same regulator sent a follow-up email to clarify that the Dec. 16 approval was actually final, MedMen alleged. After MedMen called and questioned the regulator, they reported that he said had been “pressured” to send an email finalizing the approval process.
The cannabis distributor went on in its lawsuit to accuse Ascend of leaning on the Office of Cannabis Management to approve the license transfer. MedMen accused Ascend’s president Andrew Brown of attending a fundraiser for Hochul on Dec. 8, and its CEO Abner Kurtin of meeting with her secretary on Dec. 10 to put pressure on the state to finalize the deal.
A judge approved MedMen’s motion to subpoena government records on Feb. 9, which would shed light on what happened between state officials and Ascend staff.
Ascend has responded that MedMen’s narrative about government interference is made up in its motion to dismiss the counter suit this week. No one from Ascend attended a fundraiser for the governor on Dec. 8 or met with anyone from her staff on Dec. 10, Ascend said. It argues that MedMen’s claims are a false attempt to kill the deal in retrospect.
As evidence, the company submitted court logs and a hotel receipt that show Brown providing legal counsel and staying at a hotel in Albany on the day that MedMen accused him of attending the Manhattan fundraiser. It also submitted a receipt that showed Kurtin to be in Florida the day of the other alleged meeting.
“MedMen has knowingly fabricated a narrative that Ascend exerted undue influence on New York State government officials,” the lawsuit reads.
MedMen did not respond for comment on the claims in Ascend’s amended complaint.
Editor’s note: This story was updated with new information about Ascend’s case, received after initial publication Thursday morning.