Hemp Company Sues Partner Over Alleged ‘Ponzi Scheme’

March 20, 2023 · Ganjapreneur

New Jersey hemp company is suing a Massachusetts biotech company claiming it operated a “Ponzi scheme” by using more than $700,000 it raised from the firm to fund its own projects, Salem News reports. In its lawsuit against the Salzman Group, Delta Technologies claims the drug development company took their money and used their machinery in other, failed, projects. 

According to the lawsuit, Salzman Group Chairman and CEO Dr. Andrew Salzman agreed to put together a “large team of scientists” to help Delta and its manager, Alexander Jacobs, obtain a patent to produce different types of hemp products. Jacobs and Delta agreed to pay the Salzman Group $20,000 per month for the project. The lawsuit alleges that, at first, Salzman told Jacobs that the team had made “dramatic” short-term progress, but the lawsuit contends that Salzman eventually stopped giving Jacobs updates or providing evidence of progress toward a commercially viable product. 

The lawsuit contends that Jacobs also agreed to provide cash to the Salzman Group to start a small laboratory in Beverly, Massachusetts to produce a “rare cannabinoid” to sell in Europe and “across the world” but Jacobs said the Salzman Group “never delivered the product on time,” and the deliveries that were made were “too small” to fulfill all of Jacob’s clients’ orders. In the lawsuit, Jacobs said he learned later that Salzman had never moved the product’s production to the Beverly laboratory. Jacobs also claims that the machinery provided to the project was never returned and that Delta has been unable to retrieve them.  

The lawsuit accuses the Salzman Group of intending to defraud, and defrauding, Delta “out of hundreds of thousands of dollars to pursue their own interests” with “no intent to ever produce the product plaintiffs needed.” The lawsuit accuses the Salzman Group of breach of contract and fraud. (Full Story)

In categories:Business Hemp
Next Post

Marijuana MSO TerrAscend could list on Toronto Stock Exchange by summer

Marijuana multistate operator TerrAscend Corp. could become the first U.S. plant-touching company to list on the Toronto Stock Exchange by this summer if the restructuring plan it shared with shareholders and analysts wins TSX approval. And if the company is…
Read
Previous Post

Opinion: 5 steps to close the marijuana industry’s C-suite gender gap

In an industry that once had an unusually high percentage of female CEOs, the marijuana sector now has fewer women in leadership positions than the U.S. average. According to MJBizDaily’s 2022 report, “Diversity, Equity & Inclusion in the Cannabis Industry,” the percentage of women…
Read
Random Post

Pennsylvania Launches $200,000 Grant Program To Support Hemp Marketing And Consumer Awareness

Pennsylvania officials announced on Monday that they will be providing up to $200,000 in matched funding for marketing projects to promote the state’s hemp market. The state Department of Agriculture said that non-profit organizations that take on marketing initiatives to…
Read
Random Post

Oregon Appeals Court Orders Stay of Fungus Testing Rule

The Oregon Court of Appeals on Friday suspended the state’s cannabis testing requirements for the fungus aspergillus, Willamette Week reports. The lawsuit was filed in July by the Cannabis Industry Association of Oregon, Southern Oregon Family Farms, and Cannessentials Farm who claimed the testing…
Read
Random Post

Federal Appeals Court Rules Against DEA In Psilocybin Rescheduling Lawsuit Brought By Doctor Who Wants To Give Psychedelic To Cancer Patients

A federal appeals court has ruled against the Drug Enforcement Administration (DEA) in a lawsuit over a Washington State doctor’s petition to reschedule psilocybin. The court said DEA failed to explain its reasoning when it denied the petition, and it ordered…
Read
Random Post

Willie Nelson: Marijuana saved my life

The 89-year-old country music legend - who is due to turn 90 in April - is unsure what has kept him in such good shape as he approaches his milestone birthday but explained that as well as following a healthy…
Read