A two-day hearing over the Michigan Cannabis Regulatory Agency’s (CRA) decision to suspend a Flint-based cannabis retailer’s license has resulted in a judge upholding the suspension.
As previously reported by Cannabis Business Times, state regulators suspended the medical and adult-use licenses for GC Flint LLC, which does business as Green Culture, Nov. 15 after issuing a health and safety bulletin the same day to alert consumers about allegedly unregulated and contaminated cannabis products sold by the company between Feb. 10 and Sept. 30.
The affected products included prerolls labeled as “Moonrock Blunt” that did not have identifying tags through Metrc, Michigan’s seed-to-sale tracking system.
CRA investigators received a complaint Aug. 27 that claimed Green Culture sold caregiver product that did not have test results or Metrc tagging, and during a Sept. 28 visit, the Green Culture team told CRA investigators that the MoonRock prerolls were 100% hemp-extracted CBD containing less than 0.3% THC.
The following day, investigators conducted an audit of all untested product reported in Metrc to be at Green Culture’s Flint dispensary and allegedly discovered that roughly 58 pounds of caregiver product entered into Metrc could not be located at the facility.
During an Oct. 3 visit from regulators, the Green Culture team allegedly said the company obtained product from AFC Labs, a state-licensed hemp processor that does not hold a cannabis license, and that the untagged product from AFC Labs was high-THC cannabis and not hemp.
The CRA’s investigation ultimately revealed that Green Culture allegedly sold or transferred roughly 18,000 ACF Labs products to medical cannabis patients or adult-use consumers without full compliance testing, Metrc tags and labeling. In addition, of 51 product samples collected during one of the CRA’s visits to Green Culture’s facility, 49 were confirmed to be cannabis (the other two were hemp) and more than three-quarters of the products contained paclobutrazol (a banned pesticide), nickel (a heavy metal), aspergillus (a type of mold), and/or total coliforms (bacteria) in amounts exceeding state limits, according to the CRA.
A post-suspension hearing was required to determine whether Green Culture’s license suspension should remain in effect.
As a result of that hearing, a judge with the Michigan Office of Administrative Hearings and Rules found that the CRA “has demonstrated, by a preponderance of the evidence presented to date, that the safety or health of patrons or employees is jeopardized by (their) continued operation,” according to the Detroit Free Press.
In a statement to the news outlet, Jars Cannabis, a part owner of Green Culture, indicated that it will buy out former owner and manager Pat Kanouno.
Josh Hovey, a spokesperson for the cannabis retailer, which operates multiple dispensaries in Michigan and has operations in other states, told the Detroit Free Press that the company hopes to have a chance to remedy the mistakes made by the previous management.
“Jars appreciates the CRA’s efforts to ensure everyone in this industry is following the rules and behaving responsibly,” Hovey told the news outlet. “However, we strongly believe the CRA is being overzealous in this case.”
Hovey added that while he does not believe that retailers should be responsible for inaccurate test results on products, Jars has pulled all hemp products from its shelves as a precautionary measure following the judge’s decision.