The Ontario Securities Commission asked for a leave to withdraw the charges against former CannTrust Holdings Inc. CNTTQ CEO Peter Aceto, former chairman Eric Paul and former vice-chairman Mark Litwin on December 14th, reported Global News.
The three former executives were charged with fraud and authorizing, permitting or acquiescing in the commission of an offense. Litwin and Paul were also facing insider trading charges. Litwin and Aceto were charged with making a false prospectus and false preliminary prospectus.
According to Graham Lee, a former director of quality and compliance, cultivation in unlicensed spaces was discussed “very openly” at the company.
The OSC’s case fell apart when Litwin’s lawyer Scott Fenton cross-examined Lee.
Fenton presented Lee with the license for the facility issued under the Cannabis Act and Health Canada regulations to CannTrust on Nov. 9, 2018. It listed “standard cultivation and standard processing” as authorized activity at the lone building on CannTrust’s property and did not specify any rooms.
“Were you confused regarding the operation of the Cannabis Act and its regulations?” Fenton said.
“At times,” said Lee.
The three men were acquitted just one day later and freed of charges linked to the alleged unlicensed growing of thousands of kilograms of weed at CannTrust’s Ontario facility near Niagara in 2019.
“The OSC had a reputation for a while for being weak on enforcement and this outcome doesn’t help. This was a really high-profile prosecution that was supposed to really change that perception, and clearly with this outcome, the OSC is going to have some soul searching to do,” said Doug Sarro, the lawyer and University of Toronto adjunct professor.
This is the epilogue of the troubles that bankrupted the company since the audit by Health Canada in 2019.
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Photo: Benzinga; Sources: courtesy of AJEL, lindsayfox via Pixabay
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