Seeking a halt to the sale of “intoxicating cannabinoid products” masquerading as hemp, an affiliate of marijuana multistate operator Jushi Holdings sued DoorDash and Total Wine & More this week.
In a complaint filed Oct. 27 in Virginia state court, Dalitso LLC, which operates medical cannabis dispensary chain Beyond Hello, claimed the sale of hemp THC products outside of state-regulated cannabis activity creates “an unfair and unlawful marketplace.”
The lawsuit cities the sale of “Coastalo THC Red Cream Soda” from a Total Wine location in Arlingtona, which was allegedly delivered by DoorDash.
Dalitso claims the product contained more than double the state’s legal 2-milligram THC limit for hemp products, effectively making it an unregulated intoxicating beverage.
The lawsuit comes as more and more mainstream retailers enter the cannabis space via hemp-derived THC offerings – specifically beverages.
That’s created significant concern for state-regulated cannabis businesses and their investors, who claim that hemp operators play by much different – and easier – rules.
And though Virginia MMJ sales are greatly exceeding expectations, operators in the state must remain medical only until Virginia lawmakers finally legalize adult-use sales, leading to more frustration.
Lawsuit seeks an end to the sale of hemp-derived THC
Dalitso is seeking $20 million in damages for harm to its business, according to the suit, which was first reported by Maine Wire.
The suit is seeking triple damages under Virginia’s business conspiracy statute. It’s also requesting a judge to issue orders to stop unlicensed cannabis deliveries near its dispensaries.
The lawsuit is another example of the unintended consequences of the 2018 Farm Bill.
Last week, 39 state attorneys general asked Congress to close the so-called “hemp loophole” that’s led to the proliferation of intoxicating hemp-derived THC products sold without the heavy rules imposed on cannabis operators.
Intoxicating hemp is technically illegal in Virginia, where a recent state law restricts hemp-derived products to no more than 0.3% THC.
It’s not the first time Florida-based Jushi has gone to the courts to combat competition from intoxicating hemp-derived THC products.
In August, the MSO sued online retailers and hemp producers in state court in Pennsylvania.
That suit alleged that the flow of “illegal products into unregulated retail channels directly undermines the Commonwealth’s regulated medical marijuana program.”
Hemp-derived THC products are as-yet unregulated in Pennsylvania.
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