Marijuana retailing giant Curaleaf has agreed to a $130,000 fine and a 23-day suspension to resolve state regulators’ investigation into the company’s manufacturing blunder last summer.
A Curaleaf bottling plant in Portland mixed up drops of THC, the psychoactive ingredient in marijuana, with CBD wellness drops. Made from hemp, CBD is widely available in grocery stores and doesn’t usually include the ingredient that gives users a high.
The Oregon Liquor & Cannabis Commission says Massachusetts-based Curaleaf shipped 1,500 mislabeled drops under the brand name Select, many of which it recalled at the state’s direction. But many of the bottles reached consumers, and several customers reported alarming symptoms after consuming what they believed were benign CBD drops.
The drops actually contained a jumbo dose of THC, several times what recreational marijuana users typically consume. At least five people reported going to the hospital with serious health issues.
Oregon regulators originally proposed slapping Curaleaf with a 70-day suspension and record $200,000 fine. Curaleaf challenged the penalty and the regulatory ultimately agreed to reduce the penalty to $130,000 with a 23-day suspension.
Regulatory staff credited Curaleaf with “extraordinary cooperation” and said the company demonstrated its violations weren’t intentional or persistent. Curaleaf can reduce its suspension by 11 days if it pays an additional $2,750 civil penalty.
“This is pocket change” to Curaleaf, Portland attorney Michael Fuller wrote in an email Tuesday. Fuller brought 11 lawsuits against the company on behalf of people who bought the mislabeled CBD drops. Ten have settled.
Fuller said the OLCC’s penalties appear especially weak when compared to the sanctions the commission sometimes imposes on businesses that serve alcohol.
“It’s not clear why the OLCC has historically been relatively strict when dealing with locally-owned bars, but uses kid-gloves when dealing with this multinational cannabis corporation,” Fuller said.
The commission approved the Curaleaf settlement at its monthly meeting last week. At that same meeting, regulators and staff expressed frustration over lapses at a private testing lab, mislabeling by marijuana businesses and product recalls.
Just last week, for example, Oregon announced a recall of YHN-brand THC vape cartridges sold at the Weedology and Bud House stores in Ontario. Retailers had sold 18,000 of the cartridges, which contained soybean oil that hasn’t been shown to be safe for inhaling.
Curaleaf didn’t immediately comment on its Oregon settlement. In May, the company said the mix-up occurred when a Portland employee had confused two similar buckets that had almost the same identification numbers. Curaleaf said it had changed its bottling procedures to prevent a recurrence.
Curaleaf acquired Portland-based Cura Cannabis in 2000 in an all-stock transaction worth nearly $400 million. Curaleaf Chairman Boris Jordan and former Cura CEO Nitin Khanna are now locked in a vitriolic legal fight, each accusing the other of misconduct in connection with the deal.
-- Mike Rogoway | mrogoway@oregonian.com | 503-294-7699 | Twitter: @rogoway |
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