A Bend-based cannabis firm faces a $15,000 fine and is barred from harvesting for 34 days while its growers permit is suspended, the Oregon Liquor Control Commission announced Thursday.
The OLCC cited Oregrown for seven violations of state regulations. Oregrown’s license violations stem from a former employee and stockholder who took marijuana seeds and plants from its growing facility to an unlicensed location in January 2018.
The OLCC revoked the marijuana worker permit and issued a letter of reprimand to Oregrown’s former shareholder and head grower, Justin Crawn. He will not be able to work in any legal marijuana business in Oregon without a worker permit.
“These are very serious offenses,” Matthew Van Sickle, OLCC public affairs specialist, said in an email. “But because Oregrown presented evidence that it was the victim of a theft, there were mitigating circumstances for Oregrown. The apparently responsible party has been penalized to the full extent of the commission’s power by revocation of his worker permit, and has also agreed to return the stolen seeds to the licensed system.”
Oregrown’s suspension, which begins at 7 a.m., July 20 and ends at 7 a.m., Aug. 23, means the company cannot transfer or harvest product, but can water and tend the plants, Van Sickle said. The fine must be paid by July 15, according to the agreement.
About a quarter of what the company sells in its stores is grown in-house, said Alex Tinker, Oregrown’s attorney.
This is not the first OLCC violation for Oregrown. In July 2018, the company’s then-president, Hunter Neubauer, was sanctioned for making false statements and had his worker permit suspended for 23 days. The company’s processing license was suspended by the OLCC for 46 days, and Oregrown was fined $4,950.
Neubauer is currently the co-founder. Previously he was chairman of the board.
In May, the cannabis company settled an acrimonious lawsuit filed in Deschutes Circuit Court against the former head grower Crawn. In the lawsuit Oregrown alleged 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 discussed parting ways with Crawn, and he took 51 seed packets and at least one clone of all but one strain from the Tumalo facility.
Oregrown was founded in 2014 by Aviv Hadar, his mother, Tsiona Bitton and Crawn, according to the lawsuit. Later Kevin Hogan, Neubauer and Peter and Patricia Neubauer joined the company as shareholders and directors, filings show.
“The OLCC’s actions were something that arose out of violations that a former employee committed,” Tinker said. “Hopefully this will be the end of a long story.”
The impact of the suspension on the company’s revenues will depend on harvest cycle, Tinker said.
“Oregrown is struggling to minimize the impact of the suspension, but there’s no way to eliminate it,” Tinker said. “It won’t be catastrophic, but it will be substantial.”
— Reporter: 541-633-2117, email@example.com