Surna Announces Largest Contract In Its History

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Announces $2.8 million Sales Contract in July

COLORADO: Surna announced today that it recently signed a sales contract valued at $2.8 million.

The project in Illinois is for a multi-state operator with whom Surna has worked on previous facilities in other states. The facility is approximately 88,000 square feet, of which approximately 66,000 square feet is dedicated to cultivation, drying and processing areas. Surna is under contract to provide a full suite of climate control products and technologies for the cultivation and processing spaces (the mechanical engineering design was done by Surna through a previous contract), supply of major mechanical equipment, SentryIQ™ environmental controls, and system start-up. While Surna can and does provide MEP design and equipment for a wide range of climate control approaches, in this case the priorities of reducing electrical infrastructure requirements and reducing roof loading, along with the desire for precise control of the facility’s environment, resulted in the selection of a 4-pipe hydronic system. The design has integrated dehumidification, in which Surna is providing its proprietary line of multi-function fan coils, destratification fans, dehumidifiers and heat recovery chillers.

Tony McDonald, CEO commented: “The team at Surna has worked diligently to secure the largest single contract in the Company’s history. Now our operations and controls departments will be hard at work ensuring the delivery of a precisely controlled environment and on-time delivery of equipment to meet our customer’s requirements.”

OREGON: OLCC Commission Takes Step to Continue Curbside Delivery

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Begins Process to Ban Additives in Inhalable Cannabis Products

Commissioners Also Approve Marijuana Licensee Stipulated Settlements

 

OREGON:  At its regular monthly meeting on June 18, 2020, the Oregon Liquor Control Commission moved to extend the ability of licensed marijuana retailers to continue curbside delivery, and took the first step towards adopting rules that would ban non-cannabis additives from inhalable cannabis products.  Commissioners also approved six marijuana violation stipulated settlement agreements.

In the wake of the COVID-19 pandemic the OLCC, in order to promote social distancing required under the Governor’s Executive Orders, approved a temporary rule allowing licensed marijuana retailers to make “curbside delivery” within the immediate vicinity of their licensed (premises) retail store. That temporary rule expires in September 2020 and cannot be extended with another temporary rule.

Because the duration of the pandemic remains unknown, measures aimed at accommodating social distancing requirements and minimizing person-to-person contact remain critical to protecting public health. The proposed rule provides licensed marijuana retailers flexibility in how they can deliver to consumers at their licensed premises.

In the fall of 2019, a number of Oregonians suffered from the outbreak of vaping-associated lung injury (VALI) linked in part to inhalable cannabis products.  As of March, 2020, Oregon had 23 reported cases of VALI, including two fatalities.  VALI has been tentatively linked to additives combined with cannabis oil.

Commission staff are attempting to address consumer product safety concerns by prohibiting all processed non-cannabis additives from being added to inhalable cannabis products. Non-cannabis vaping additives are used in cannabis vaping products for a variety of purposes, including dilution, flavor, and effects.  However, non-cannabis additives are not necessary to make a vape product work with vaping technology.

Although the additives may be generally recognized as safe (GRAS) for ingestion, the same cannot be said for their inhalation. There is no regulatory body that evaluates the safety of these ingredients when inhaled, and additive makers do not disclose all of their ingredients due to trade secret concerns.

The Commission also ratified the following violation fines and suspensions based on stipulated settlements (detailed information on specific cases can be found here on the OLCC website):

  • MAHALO in Hillsboro will pay a fine of $3,795 OR serve a 23-day recreational marijuana retailer license suspension for one violation.

Licensee is: Mahalo, Inc.; Frankie Powell, President/Secretary/Director/Stockholder.

  • PLANE JANE DISPENSARY in Portland will serve a 30-day recreational marijuana retailer license suspension OR pay a fine of $3,795 AND serve a seven-day suspension for one violation.

Licensees are: Plane Janes’ LLC; Patricia Wiegele, Member.

  • MYLES MYERS will pay a fine of $750 OR serve a 30-day marijuana worker permit suspension for one violation.

Marijuana Worker Permit #393L5E.

  • GREEN BOX in Portland will pay a fine of $2,640 OR serve a 16-day recreational marijuana retailer license suspension for two violations.

Licensees are: Green Box, LLC; Adrian Wayman, Member; Robert Wayman, Member.

  • PARADISE FOUND in Portland will pay a fine of $10,230 OR serve a 62-day recreational marijuana retailer license suspension for two violations.

Licensees are:  JIMO Holdings, LLC; Joseph Cohen, Member; Idan Magal, Member; Arman Daytian, Member/Manager.

  • WINDS OF CHANGE* will surrender its recreational marijuana producer license suspension for eight violations.

Licensees are:  Winds of Change, LLC; James McQuade, Member.

Virtual Listen and Learn Forum: Rules Regarding Tier 1 Producer Licensing, Session #2

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WASHINGTON: The Washington State Liquor and Cannabis Board (WSLCB) is hosting two Listen and Learn forums about the current rules regarding marijuana producer licenses, specifically the consideration of revisions and new rule sections that would incrementally expand the plant canopy square footage allowed for licensed Tier 1 producers. This is the second of two planned sessions. Session #1 will cover WAC 314-55-075 Sections 1 through 5. Session #2 will focus on Sections 6 through 11.The full text of WAC 314-55-075 is provided here.

Please join us virtually on Tuesday, June 30, 2020, from 1:00 p.m. until 3:00 p.m. via WebEx in alignment with guidance and recommendations issued by the Governor’s office.

As you may recall, the Board began to consider revisions to existing producer license rules by initiating a formal rule inquiry on December 18, 2019. The Pre-proposal Statement of Inquiry filed by the Liquor and Cannabis Board may be found here.

The Board has received requests from medical marijuana patients and segments of the industry to increase the availability of Department of Health (DOH) compliant product in licensed retail stores. The Board has also learned that smaller producers are concerned about business sustainability based on canopy space restrictions. Recognizing this, the Board would like to explore the ways that it can support Tier 1 producer business viability. Revisions considered may also include clarifying and technical updates to existing rule within the scope of this topic.

An agenda is attached to help you prepare. Please come prepared to offer feedback and suggestions regarding this rule section.

If you wish to join us virtually, we’d like to offer the following reminders:

  • Virtual participation will be structured to allow one speaker at a time though the hand-raising feature on WebEx.
  • If you experience difficulty with audio or visual elements of virtual participation, please be patient.

Please remember that we are still in the developmental phase of rulemaking, and there are not yet any proposed or final rules amendments. To help you prepare for this listen/learn/contribute forum, please review the guidance document prepared for this and future forums.

Questions? Contact Casey Schaufler at casey.schaufler@lcb.wa.gov

To join the WebEx meeting online:

https://watech.webex.com/watech/onstage/g.php?MTID=e704a0de07d3b41806e1f7f59ba96195e

To join the WebEx meeting via audio conference only:

Toll Free: 1-855-929-3239
Access Code: 133 418 7301

Washington: WLSCB Virtual Listen And Learn Forum: Draft Conceptual Rules Regarding Marijuana Licensee True Party Of Interest Rules

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WASHINGTON: The Washington State Liquor and Cannabis Board (WSLCB) has rescheduled a Listen and Learn forum on draft conceptual rules regarding marijuana true party of interest regulations described in WAC 314-55-035 to accommodate concerns around the COVID-19 outbreak.

Please join us virtually on Wednesday, May 20, 2020, from 1:00 p.m. until 3:30 p.m. via WebEx in alignment with guidance and recommendations issued by the Governor’s office.

As you may recall, the Board began to consider revisions to existing marijuana true party of interest rules by initiating a formal rule inquiry under WSR 18-22-54 in October, 2018. Those efforts were extended by the passage of Engrossed Substitute House Bill (ESHB) 1794, concerning agreements between licensed marijuana businesses and other people and businesses, including royalty and licensing agreements relating to the use of intellectual property during the 2019 regular session of the Washington State legislature

During the summer, and into the fall and winter of 2019, WSLCB held multiple meetings with industry association representatives, licensees, and others to draft the conceptual rules we’ll be discussing during this Listen and Learn session. These conceptual draft rules reflect an engaged and inclusive developmental process that embodies not only WSLCB’s commitment to regulatory stability and consistency, but to listening to and learning from the input of licensees. They also represent a significant agency policy shift in the removal of the spousal vetting requirement.

An agenda is attached to help you prepare. Please come prepared to offer feedback and suggestions regarding this new rule section and the draft conceptual rules.

If you wish to join us virtually, we’d like to offer the following reminders:

  • Virtual participation will be structured to allow one speaker at a time though a hand-raising feature on WebEx.
  • If you experience difficulty with audio or visual elements of virtual participation, please be patient.

Please remember that we are still in the developmental phase of rulemaking, and these are not proposed or final rules. To help you prepare for this listen/learn/contribute forum, please review the guidance document prepared for this and future forums.

Questions? Contact Kathy Hoffman at katherine.hoffman@lcb.wa.gov

To join the WebEx Event:

Event address for attendees: https://watech.webex.com/watech/onstage/g.php?MTID=e13ac4927e2202ebbb097b00732f4e5b0

To attend by phone: (TOLL) +1-415-655-0001 or (TOLL FREE)+1-855-929-3239

Access code: 285 815 516

Canopy Growth Announces Changes To Global Operations To Drive Strategic Focus

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The Company continues to expect to incur approximately $700-800MM pre-tax charge in Q4 Fiscal 2020.

CANADA: Canopy Growth Corporation (“Canopy Growth” or the “Company”) (TSX:WEED, NYSE:CGC) today announced a series of global operational changes designed to further optimize production, better align supply and demand, and improve efficiencies in its global operations. As part of its ongoing strategic review of the business, the Company announced today the following changes to its operations:

  • Africa: Canopy Growth has exited its operations in South Africa and Lesotho, transferring ownership of all of its African operations.
  • Canada: The Company will shut down its indoor facility in Yorkton, Saskatchewan, to further align production in Canada with market conditions.
  • Latin America: Canopy Growth will cease operations at its cultivation facility in Colombia, moving to an asset-light model that leverages local suppliers for raw materials and Procaps for formulation and encapsulation activities as outlined in the previously announced agreement between the two companies. These activities will support the position of Colombia as the Company’s LATAM production hub and the ongoing development of its cannabis industry.
  • United States: Canopy Growth will cease its farming operations in Springfield, New York, due to current market demand for hemp.

“When I arrived at Canopy Growth in January, I committed to conducting a strategic review in order to optimize our cost structure and reduce our cash burn,” said David Klein, CEO, Canopy Growth. “I believe the changes outlined today are an important step in our continuing efforts to focus the Company’s priorities, and will result in a healthier, stronger organization that will continue to be an innovator and leader in this industry. I want to sincerely thank the members of the teams affected by these decisions for their contributions in helping build Canopy Growth.”

The Company continues to expect, based upon information currently available to management, to record estimated pre-tax charges of approximately $700-800MM in the quarter ending March 31, 2020. This relates to this announcement and previous announcements, as well as any additional changes made during the organizational and strategic review. The organizational changes announced today include a headcount reduction of approximately 85 full-time positions.

All figures reported above with respect to the quarter ending March 31, 2020 are preliminary and are unaudited and subject to change and adjustment as the Company prepares its consolidated financial statements for the year ending March 31, 2020. Accordingly, investors are cautioned not to place undue reliance on the foregoing information. The Company does not intend to provide preliminary results in the future. The preliminary results provided in this news release constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian securities legislation, are based on several assumptions and are subject to a number of risks and uncertainties. Actual results may differ materially. See “Notice Regarding Forward Looking Statements”.

OLCC Will Temporarily Accept Expired State Of Oregon Issued ID

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OREGON: The Oregon Liquor Control Commission will allow alcohol and marijuana licensees to accept expired Oregon driver licenses or identification cards that expired, on or after March 8, 2020, as an acceptable form of identification.

This decision aligns with the Oregon Department of Motor Vehicles and law enforcement position, as DMV offices are closed because of the COVID-19 public health crisis preventing individuals from renewing their driver’s license or ID cards.

This temporary exception only applies to driver licenses and identification cards issued by the State of Oregon. This exception will remain in place while the Governor’s Executive Order 20-03remains in effect.

This addresses a concern, brought to the attention of the OLCC, faced by former Oregon Medical Marijuana Program cardholders, who have transitioned to the recreational marijuana system, but have driver’s licenses or identification cards that have expired.

On March 20, 2020, The Oregon DMV asked law enforcement to exercise discretion in enforcing violations due to expired credentials and the Oregon State Police, Oregon State Sheriff’s Association and the Oregon Association of Chiefs of Police have agreed to support this “grace period.”

Additional information can be found in the OLCC recreational marijuana program FAQ.

Information about COVID-19 related changes to OLCC rules, program and compliance/enforcement can be found on the OLCC COVID-19 Business Continuity page on the OLCC website.

Viola Launches Viola Cares With National Non-Profit Organization Root And Rebound

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Social Impact Initiative Aims to Destigmatize Minority Representation and Increase Social Equity Within the Cannabis Industry

CALIFORNIA: Viola, a nationwide leader in the production and sale of premium quality cannabis products founded by NBA veteran Al Harrington, today announced the official launch of its social equity initiative – Viola Cares. Through education, equitable offerings, expungement, and incubation programs, the initiative will result in more than 10,000 jobs, hundreds of new business owners and expanded industry diversity by increasing representation, facilitating community building and providing employment opportunities.

Viola’s first strategic alliance within its Viola Cares program kicks-off with Root & Rebound. Root & Rebound is home to lawyers and advocates committed to restoring power and resources to the communities most harmed by mass incarceration and the War on Drugs. Their work combines direct legal services with systems-changing policy advocacy and public education, in an effort to move society toward greater racial and economic equity, justice, collective liberation and intergenerational healing. Their educational resources like the California Roadmap to Reentry, the Reentry Planning Toolkit, the National Fair Chance Housing Toolkit, and others have supported thousands of people as they work to navigate the collateral consequences of an arrest or conviction history.

Viola, in conjunction with Root and Rebound, will produce a first-of-its-kind toolkit designed specifically for people with cannabis-related convictions, to be entitled: “A New Leaf: A ‘How-To Guide’ for Successful Reentry After A Cannabis Conviction.”

“At Viola, we live and breathe the belief that a cannabis conviction should never be considered a life sentence,” said Al Harrington, Founder, Viola. “In joining forces with Root and Rebound, we will look to help those communities of color who have historically been the victims of cannabis-related incarceration and who have fallen on hard times, and turn those struggles into opportunities for success within this rapidly growing industry.”

Opportunity within the cannabis industry only continues to grow as legalization progresses and passes into law across the country, and Viola is breaking the barrier of entry for minorities to contribute to that growth through cultivation and entrepreneurship.

“We’re honored to be working side-by-side with Viola on such an important initiative–one that positively impacts thousands who have been unfairly stigmatized by their prior cannabis-related incarceration,” Katherine Katcher, Founder and Executive Director of Root and Rebound. “Together we’re changing that conversation, leveling the playing field for minorities and creating opportunities for those deserving of a second chance.”

In celebration of the strategic alliance between Viola and Root and Rebound, Viola will host a welcome reception and panel discussion in support of the launch of “A New Leaf” toolkit at the Viola headquarters in Los Angeles on February 26, 2020. A moderated panel hosted by Viola CMO Ericka Pittman will include Katherine Katcher, Eliana Green, and Sandra Johnson from the Root & Rebound team, along with Al Harrington and Dan Pettigrew, Co-Founders of Viola moderated by Van Lathan.

WSLCB Issues Emergency License Suspension For Herban Legends In Seattle

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wslcbWASHINGTON: The Washington State Liquor and Cannabis Board (WSLCB) issued an emergency suspension and revocation of marijuana retailer “Herban Legends,” License No. 420291, located at 55 Bell St. Suite 100, Seattle, WA 98121. The licensee has held a marijuana retail license since February 2016.

This emergency suspension follows complaints from employees, vendors, nearby businesses and Seattle Police Department (SPD) officials. Concerns include the licensee engaging in erratic and criminal behavior on the license premises. The substance of the complaints was validated by the WSLCB during onsite visits, interviews with complainants, and the SPD.

There have been several SPD-involved incidents at the license premises, including a Nov. 21, 2019 incident where SPD responded to a report that the licensee was throwing marijuana products and other merchandise into the parking lot and street of the license premises. Upon arrival, SPD confirmed marijuana products were on the ground outside the business and they were told by individuals in the parking lot that the owner was giving away product – a violation of state law. Over the past several weeks there have been additional law enforcement actions and arrests of the licensee.

Due to the public safety risk of the licensee being unable or unwilling to demonstrate that cannabis product is beings secured on the premises and entered into the state traceability system, the Board issued the emergency suspension. Because the license is held by a single individual, the legal oversight of the business cannot be temporarily assumed by another individual.

Emergency suspensions represent an extraordinary exercise of the state’s power and the WSLCB is mandated to ensure that an emergency suspension is reasonable, justifiable and legal in every way. The WSLCB issued one emergency suspension in 2017, four in 2018 and two in 2019.

U.S. District Court Dismisses TCPA Lawsuit Against Eaze, Upholding The Ability Of Legal Cannabis Industry To Enter Binding Contracts

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eaze

Ruling sets important precedent for both California’s legal cannabis market and legal cannabis industry in America

CALIFORNIA: Eaze Technologies, Inc. today announced that it obtained a complete dismissal of Williams v. Eaze, Inc., a putative nationwide class action lawsuit brought under the Telephone Consumer Protection Act (“TCPA”), by successfully enforcing the arbitration agreement in its Terms of Service.

In her lawsuit, Plaintiff Farrah Williams, attempted to circumvent the arbitration agreement in Eaze’s Terms of Service by arguing that cannabis contracts cannot be “formed” because cannabis is illegal under federal law. The court rejected this claim, thus preserving the ability of cannabis businesses, operating where cannabis is legal under state law, to enter into and enforce basic contracts with customers, individuals, and other businesses.

“This ruling is enormously important for the entire industry, as contracts across California and nationally could have been invalidated had the court found for the Plaintiff,” said Andrea Lobato, Chief Risk Officer at Eaze. “We are pleased to have successfully defended the basic right of legal cannabis companies to enter into contracts.”

After substantial briefing and argument led by Boies Schiller Flexner partners, Albert Giang and Michael Roth, the district court concluded that a proper contract had been formed, delegated other disputes to the arbitrator, and dismissed Plaintiff’s nationwide class action. Specifically, while noting that the case raises interesting issues about “ganjapreneurship,” the Court concluded that Eaze’s business “is legal under California state law” and arbitration was required under the Federal Arbitration Act (“FAA”).

“The court correctly found that cannabis companies are not barred from forming and enforcing basic contracts, and that Eaze’s business is legal under California state law,” said Giang. This ruling sets an important precedent for California’s legal cannabis market, and more broadly for the legal cannabis industry in America.

 

Eaze Partners With Fairmont Miramar Hotel & Bungalows Santa Monica And Recreational Embassy To Debut Eaze Hospitality

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CALIFORNIA: Eaze, California’s leading cannabis delivery marketplace, announced a new partnership with Recreational Embassy, an elemental curator of cannabis and hemp solutions for the luxury hospitality market, to bring high-touch cannabis experiences to luxury hotel guests with the launch of Eaze Hospitality. The Eaze Hospitality concierge service will debut at the Fairmont Miramar Hotel & Bungalows Santa Monica, marking a first-of-its-kind intersection of tourism and the cannabis industry.

“The partnership with the Fairmont and Recreational Embassy is another proof point that cannabis is normalizing,” says Sheena Shiravi, Senior Director of Marketing at Eaze. “Offering adults in-hotel access to safe and legal cannabis at California’s luxury tourism destinations reinforces how beneficial it is to incorporate cannabis into every aspect of your life.”

Eaze Hospitality is designed to meet the needs, tastes, and lifestyle of the luxury cannabis consumer. Features include a concierge service that serves as a resource for guests’ questions and supports a positive cannabis experience. Eaze Hospitality is committed to educating both new and existing customers about the benefits of cannabis and the innovative products available to them.

“Hotels should have a safe, legal and thoughtful approach to meet the needs of the modern luxury hotel customer,” says Fairmont Miramar Hotel & Bungalows Director of Sales and Marketing, Rebecca Huetter. “By partnering with Recreational Embassy, we are able to provide the contemporary level of hotel amenities our guests have come to expect.”

“Being present is what the new modern luxury travel experience is all about, and cannabis is the key wellness product to help you get there,” said Lauren Rogers, Chief Executive Officer of Recreational Embassy. “As we guide the hospitality industry along this fresh customer journey with integrity, Eaze Hospitality reinforces the overlap between the new cannabis consumer and the modern luxury traveler.”

The Fairmont Miramar Hotel & Bungalows in Santa Monica, California is the first property to leverage Eaze Hospitality to facilitate access to legal, compliant and brand-aligned hemp and cannabis products and services. Guests aged 21+ will have access to customized in-room menus that feature low-dose and non-inhalation hemp and cannabis products. Through Recreational Embassy, the hotel will also offer bespoke CBD products including a custom scented fig CBD-infused bath bomb inspired by the property’s signature fig tree.

The potential to holistically reshape the signature elements of a luxury property hotel-stay by integrating hemp, cannabis and CBD products offers an unprecedented opportunity for hotels to drive incremental revenue. “We bridge the gaps between both those experienced with cannabis and those we call ‘canna-curious’ who are interested to learn more,” says Brian Applegarth, Chief Education Officer of Recreational Embassy. “The most common questions we hear from visitors are about how to get cannabis products and where to enjoy them. Our goal is to minimize confusion for hotels and their guests while maximizing on-property experiences and driving incremental value.”