California cannabis corporation Kushy Punch just lost its small business license just after state authorities found that the corporation was operating from an unlicensed facility.
In October, the California Division of Customer Affairs (CDCA) raided an illegal vape manufacturing facility in northern Los Angeles, seizing 7,200 illicit cannabis vape cartridges valued at practically $21 million. These vape carts have been packaged with the logos and likeness of Kushy Punch, a legal weed small business that has been operating in California’s healthcare marijuana marketplace for more than two decades.
Kushy Punch runs a completely licensed cannabis facility in California, building edibles, extracts, and other goods compliant with the state’s strict testing regulations. But, according to an anonymous supply, the corporation had a double life. At this secret facility, the corporation allegedly produced goods applying weed that failed testing due to contamination with mold, pesticides, or heavy metals. These goods have been basically getting turned into illegal knock-offs of the company’s personal genuine goods.
This week, the California Bureau of Cannabis Manage revoked Kushy Punch’s small business license more than the incident. “All industrial cannabis activity in California ought to be performed on a premises with a valid license issued by the acceptable state cannabis licensing authority,” California regulators stated in a statement reported by Marijuana Small business Every day. “Manufacturing, distributing or promoting cannabis goods without the need of a state license or at a place that is not licensed is a violation of state law.”
An lawyer for Kushy Punch shifted the blame to the state, arguing that higher taxes and fees of compliance are forcing numerous cannabis firms out of small business. “The Much more Agency, as the sole owner to all rights to the recipes, formulas and intellectual home pertaining to Kushy Punch, is saddened by the license revocation … ” stated the company’s legal counsel, Eric Shevin, to Marijuana Small business Every day.
“We have witnessed what has been termed a cannabis extinction occasion, as numerous operators are unable to withstand the licensing delays, fees and onerous taxes that continue to be a barrier for historical brands like Kushy Punch to survive,” Shevin continued.
The BCC’s choice to shut down Kushy Punch is not surprising, provided the current outbreak of vaping-associated lung illness. Wellness officials have linked numerous instances of this illness to black-marketplace cannabis vapes, and federal authorities now think that vitamin E acetate – an ingredient generally only located in illegal goods – may possibly be causing these lung injuries. Quite a few states have attempted to handle this crisis by banning legal vapes, but California is operating to retain illegal goods off the marketplace.