Legal Win For Glass House: LA Court Dismisses Lawsuit Alleging Illegal Cannabis Dealings

Glass House Brands Inc. GLASF GHBWF announced on Monday that a California court dismissed a lawsuit accusing the cannabis giant of involvement in the illegal cannabis market. The Superior Court of California in Los Angeles County ruled in favor of Glass House, dismissing the case with prejudice and awarding costs against the plaintiff, Catalyst Cannabis Co.

Court Rejects Catalyst’s Claims Against Glass House

The dismissed suit, filed by Long Beach-based retail chain 562 Discount Med Inc., operating as Catalyst Cannabis Co., alleged unfair competition by Glass House. The court, however, ruled on June 25, that the imposition of an injunction as requested by Catalyst would encroach on the regulatory duties of administrative agencies, deeming any such enforcement as overly burdensome. Consequently, the case concluded last Monday, with a judgment favoring Glass House, which also included an order for Catalyst to cover the legal costs, according to a press release from Glass House.

This dismissal comes after a year of legal battles that began in June 2023, when Catalyst accused Glass House of diverting legally produced cannabis to illegal markets. Glass House responded by countersuing Catalyst and its principals for defamation, a case Glass House voluntarily dismissed last May, citing concerns over Catalyst’s financial instability and potential harassment.

Glass House Defends Compliance California's Regulations

Glass House’s adherence to California's METRC system for monitoring licensed cannabis operations has been a cornerstone of their defense. Despite Catalyst’s CEO, Elliot Lewis, criticizing the court’s decision as a sidestep, the ruling points to the complexity of enforcing such allegations and notes that regulatory responsibilities fall to the state's Department of Cannabis Control (DCC).

Glass House continues to emphasize its commitment to compliance and operational integrity amidst California’s cannabis industry-wide hurdles.

GLASF Price Action
GLASF's shares were trading 1.23% higher at $7.00 per share at the time of this writing around 10:50 AM ET Monday.

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