The cannabis grower who was fired and later sued by Oregrown is seeking $9 million in damages and claims in a recent court filing that the company deprived him of $600,000 in proportional ownership interest.
Oregrown Industries Inc. filed the initial lawsuit in August in Deschutes County Circuit Court against its former head grower, Justin Crawn, and sought $2.7 million in damages, as well as an order stating Crawn is no longer a shareholder and an order for Crawn to return control of social media accounts to Oregrown.
Even though Crawn, who is identified in the initial lawsuit as a medical and black-market grower, did not contribute any cash to the company’s formation, he was made a shareholder in Oregrown and Downtown Bend Flagship Inc.,the entity that holds the state license for recreational retail sales.
Crawn claims that Oregrown’s founders in January offered him $600,000 for his 18 percent ownership interest if he resigned quickly and that they would allow him to take any strains of cannabis as long as he was discreet, according to the counterclaim filed Nov. 21. Two weeks later, that offer was off the table, and Oregrown fired Crawn for disparaging the company on Instagram and for taking company property, Crawn’s counterclaim states.
Oregrown claims in its initial suit that under Crawn’s care, the company’s growing facility in Tumalo was a complete loss and didn’t produce any shelf-worthy flower. The company also says that upon his termination Crawn took 51 seed packets and at least one clone of all but one strain, which were reported to law enforcement and the Oregon Liquor Control Commission.
Alex Tinker, the attorney representing Oregrown, referred any questions about the lawsuit to the complaint filed in August.
“In his filing, Mr. Crawn admits to removing Metrc-tagged plants from the Oregrown campus in violation of Oregon law, which, among other things, led to his termination,” Tinker said in an email. “The evidence will prove his counterclaims lack merit.”
The two claims contain competing allegations and paint a picture of financial strain from 2017.
While Oregrown blames Crawn for crop failures, he says in his counterclaim that the problem was the Tumalo facility’s cooling system and the financial issues facing the company. “Growing cannabis at the (Tumalo) facility was fraught with problems from the beginning,” the counterclaim states. “Problems included overspending on a myriad of failed ventures … and faulty designed grow rooms, which resulted in failed grows and failed greenhouse herb.”
Oregrown continued to experience financial pressure, and Crawn was told to use mold-infested crops. He refused, according to the counterclaim.
Communication broke down after Crawn posted his departure from Oregrown Industries and Downtown Bend on an Instagram account and others responded, according to the counterclaim.
Using social media, specifically Instagram, Oregrown co-founder Aviv Hadar posted defamatory comments against Crawn, calling him “a cancer that needs to be cut out,” according to the counterclaim.
Crawn could not be reached for comment. Crawn’s lawyer, Cecil Gill, stated in an email, “There will be no comment coming from my office or Mr. Crawn regarding this case. The filing speaks for itself.”
Meanwhile, the Oregon Liquor Control Commission, which oversees the recreational cannabis industry, in March investigated the removal of seeds from the licensed facility to a nonlicensed one, the counterclaim states. Ultimately the OLCC issued a notice of proposed license cancellation and fined the marijuana grower, processor and dispensary operator $4,950 and issued a 46-day suspension, which affected the wholesale processing business. The suspension ended in October, OLCC spokesman Mark Pettinger said.
The commission’s action against Oregrown stemmed from its use of hemp oil and false statements that co-founders Hunter Neubauer and Hadar made to inspectors about the hemp oil, according to the commission’s press release.
Neubauer himself served a 23-day suspension for false statements, according to the OLCC. Neubauer is on the board of directors of the Bend Chamber and has served on a rules advisory committee for the OLCC.
Crawn is seeking the removal of Hadar as a director, officer or shareholder of Oregrown, an independent custodian to manage the business and the redemption of his initial shares at a fair value.
— Reporter: 541-633-2117, email@example.com