MJ Biz reports
California marijuana multistate operator Moxie sued the billionaire family backing insolvent Green Growth Brands, claiming fraud in connection with a $310 million merger deal in 2019 that was scrapped.
Moxie, as MXY Holdings, filed the suit this week in Delaware’s Chancery Court against the Ohio-based marijuana and CBD company’s founder, Joseph Schottenstein, his family members and others, Law360 reported.
The suit claims the defendants fraudulently misrepresented their intentions, persuaded Moxie to loan $5 million to Green Growth Brands, then scrapped the merger deal several months later without repaying the loan or a $10 million stock termination fee.
The defendants “enriched themselves by siphoning off Moxie’s labor, resources, and goodwill – all the while stifling Moxie’s ability to engage in competitive business activities and carry out its strategic growth plans,” according to the complaint obtained by Law360.
Schottenstein and the other defendants didn’t immediately respond to a Law360 request for comment.
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