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Lawsuit Alleges Illegal Cannabis Diversion & Counterfeiting In California Industry

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George Engers, former COO of California-based cannabis company Top Shelf filed a lawsuit alleging whistleblower retaliation, wrongful termination, fraud, breach of contract and more.

Engers and former general delivery manager Garrett Webb reported $2.1M in illegal cannabis diversion and counterfeiting to state and federal authorities, but no action was taken.

What’s In The Lawsuit?

The civil suit aims to expose issues within the California marijuana industry, wrote Green Market Report’s John Schroyer.

Engers provided evidence to the California Department of Cannabis Control (DCC) and the FBI regarding alleged large orders placed by defendant Quan Le with licensed cannabis vendors.

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However, the FBI and DCC closed their investigation into Top Shelf without comment.

According to the lawsuit, Engers and Webb began working with Le in 2021 when Le hired Engers away from Sacramento-based cannabis retail chain Kolas with the promise of a 21% ownership stake in a new startup, which was Top Shelf.

In January 2022, Engers noticed large cash withdrawals from the account that he typically used for payroll and later concluded that Le and his wife were embezzling money from their own business, according to the suit.

Top Shelf and its co-defendants deny the allegations and look forward to proving the falsity of the claims.

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Engers believes there has been a lack of investigation or penalty by authorities for Top Shelf’s violations of state and federal laws. “Despite reporting the violations and providing evidence, the business remained unaffected with an active license,” he said.

The civil suit seeks to bring attention to the lack of accountability for cannabis companies operating outside the bounds of the law.

More details HERE at Green Market Report.

Image By Benzinga

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