Harvest Health and Recreation got hit with a couple lawsuits last week from former employees alleging a long list of compliance violations from storing cannabis products in the ceiling to selling CBD products exceeding THC limits in their lobby.
Altogether, one lawsuit seems like a damning condemnation of Harvest's business practices. But going through the claims individually, they all sound like what you'd expect within the cannabis industry.
Some of the violations have clear implications for patients, including shortcuts in labeling of Harvest's Rainbow shake and claiming all their products are tested by a third party, which the lawsuit claims is false advertising.
Other violations patients might miss having around, like recording all sales as flower, including edibles and concentrates, or recording flower sales as weighing nothing, allowing patients a little (or a lot) of leeway in their allotments.
It does raise the question of how much oversight the Arizona Department of Health Services maintains over the industry if a store of the largest cannabis operator in the state—and contender for largest in the country—can get away with reporting only flower sales, and weightless at that.
DHS compliance has been spotty for the industry in the past—especially when it comes to allotment records, which some in the industry consider understandable for budding corporations.
While the DHS won't look kindly on any violations it finds out about, stuff like where products get stored or chasing down every employee who gets high isn't really on their radar.
Likely of more concern will be personnel concerns and the exact nature of the CBD product Harvest sold in its lobbies. Selling THC to the public is a bigger mistake than it seems Harvest would make, and DHS track down every dollar it's owed for dispensary agent cards.
Former new store opener and trainer Mollie McCurdy quit after several of the violations she noticed went unremedied and her concerns were met with laidback demeanor. She's suing for several compensatory packages under wrongful termination.
A human resources employee told McCurdy the company was "selling a dream that turned out to be a nightmare" to new hires, according to the lawsuit.
Aside from the violations themselves, the lawsuit details other employees' efforts to persuade McCurdy to overlook violations and break the law by working at dispensaries prior to receiving her dispensary agent identification.
McCurdy leveled many of the claims at her former supervisor, director of retail Chantelle Elsner, who apparently called McCurdy—the person she hired to identify compliance violations—a "compliance Nazi" and told her to "chill out."
But the lawsuit also paints a picture of, well, pretty much what you'd expect from people who work for one of the biggest cannabis companies in the country.
The lawsuit mentions a group of individuals smoking a joint during a happy hour event and claims Harvest's former director of events, Kimberly Owies, distributed medicated chocolate chips in ice cream at a "Grillin' n' Chillin'" event last summer.
Imagine that. Cannabis at a dispensary party. A modicum of patients and industry workers think cannabis should be illegal in the first place. Sure, it's the law, but let's not forget why.
The cannabis industry's legal track record shows it's the only industry Republicans want to regulate. This lawsuit could provide plenty of ammo against the industry in the upcoming elections and politically in the future.
It's important to implement consumer regulations to protect the $400-million industry's 230,000 patients, but a lot of the pressure is an artefact of cannabis prohibitionists from last century.
Surely Budweiser cracks a few dozen kegs at the company Christmas party.
The lawsuit details a conversation in Arkansas when McCurdy and several other employees traveled to Little Rock to open the city's first dispensary.
When McCurdy complained about not having a dispensary agent card to work in Arkansas, Owies told her to "bend a little."
Owies evoked the company's former executive chairman of board Jason Vidadi who said, "the only people making money in the cannabis industry are the ones not in compliance," according to the lawsuit.
Coincidently, that same day, Arkansas police raided the home of one of Harvest's managers who was apparently growing cannabis at home to help out with cultivation efforts.
Though DHS might choose to make an example out of Harvest, this lawsuit alleges little that many of the industry's employees might not see on a fairly regular basis.
CEO Steve White told the Phoenix New Times "of course" the allegations would be denied.