Cannabis firms face lawsuit for 'overstating' THC content in products
The complaint alleges the companies violated California consumer protection laws, including the state’s unfair competition law and false advertising law.
DreamFields Inc. and Med for America Inc., makers and marketers of Jeeter brand cannabis products, are facing a class action lawsuit alleging they overcharge consumers by selling products containing substantially lower levels of THC content than what is listed on the packaging, according to Dovel & Lunger, the law firm that filed the suit.
According to the complaint, Jeeter products at times overstate the actual THC content by 70%-100%.
“Consumers are willing to pay more for cannabis products with higher THC content and expect to pay less for cannabis products with lower THC content,” Christin Cho of Dovel & Luner, said in a release.
The complaint, which was filed in the Superior Court of the State of California County of Los Angeles, claims the companies have violated state consumer protection laws, including California’s unfair competition law and false advertising law.
The suit leans on a report from cannabis trade publication WeedWeek, which tested several prerolled marijuana cigarette brands to verify the accuracy of on-label THC claims. The report concluded that “potency inflation is close to ubiquitous” across the tested products.
For example, a package of Jeeter prerolled joints carried a claim of 46% THC on the label, according to the complaint. The lab tests showed the actual THC content of the product was between 23%-27% THC, which is beyond the 10% margin of error allowed under California regulations.
Is there coverage?
According to Stephanie Bozzuto, co-founder of Cannabis Connect Insurance Services, an Acrisure Partner, if the companies were doing their own labeling, there might be some coverage under personal and advertising injury provisions of a general liability policy.
“Did the cannabis testing lab give them the THC percentages to put on the labels? If so, possibly they are at fault and would need to file a claim on their professional/E&O policy,” Bozzuto told PropertyCasualty360.com.
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