Trulieve legal settlement comes amid scrutiny of racial bias in cannabis industry

April 19, 2023 · MJ Biz Daily

Trulieve Cannabis has settled a lawsuit with a Black former middle manager who accused the Florida-based medical marijuana multistate operator in a complaint filed last month of paying her and other Black employees less than whites.

According to records filed April 13 in the 2nd Judicial Court in Tallahassee, where Trulieve is headquartered, the company reached a settlement with Brooke Bennett, who worked as a manager in the company’s 200-person St. Petersburg call center from August 2018 to 2022.

Terms weren’t disclosed, and the suit was dismissed Monday.

But Bennett’s claims come at a time when the cannabis industry continues to struggle to extend opportunity to racial minorities, whose ownership of marijuana businesses and representation in C-suites are dwindling.

Last year, only 12.1% of U.S. marijuana executives were nonwhite, down from 13.1% in 2021 and 28% in 2019, according to the 2022 MJBizDaily report, “Diversity, Equity & Inclusion in the Cannabis Industry.”

It’s a similar story for cannabis business ownership by racial minorities.

Bennett’s suit also highlights the struggles encountered by marijuana industry employees, particularly those from marginalized groups.

In her lawsuit, filed March 14 in the 2nd Judicial Court, Bennett alleged that she received lower pay than less-qualified white colleagues working in identical roles.

Additionally, Trulieve allegedly paid Black entry-level workers 50 cents less per hour than white employees.

Moreover, Bennett’s lawsuit alleged racial and gender discrimination as well as retaliation.

Records show Bennett’s suit, filed after a federal Equal Employment Opportunity Commission (EEOC) complaint, is one of a bevy of lawsuits filed in Florida state and federal courts over the past year alleging workplace discrimination or harassment at Trulieve, the biggest marijuana company in Florida and one of the largest in the nation by revenue.

At least seven lawsuits remain open, according to records.

The company has also poured more than $30 million so far into a 2024 adult-use legalization initiative in the state.

Critics say passage of the measure would only enlarge Trulieve’s commanding position in Florida’s legal marijuana market.

The detailed accusations in Bennett’s lawsuit are the latest racially charged headache for Trulieve, which last summer acknowledged that a Juneteenth promotion critics saw as racist was “culturally insensitive.”

Honored for diversity efforts

Yet, Trulieve has won recognition for its diversification efforts from an organization advocating for minority participation in the cannabis sector.

In January, Florida-based Minorities for Medical Marijuana honored Trulieve as its 2022 Diversity & Inclusion Corporate Champion of the Year.

Roz McCarthy, the founder and CEO of Minorities for Medical Marijuana, declined to comment to MJBizDaily on Monday about the lawsuit.

In a lengthy statement emailed to MJBizDaily on Tuesday night, Trulieve said it “took the allegations of Ms. Bennet’s case very seriously. However, after a thorough review, we found she was the third-highest paid employee in her department and that the raise disparity was due to an administrative error and nothing more.”

The company also made allegations about Bennett and her attorney that MJBizDaily could not confirm.

The statement went on to single out MJBizDaily‘s coverage of Trulieve:

“MJBiz has a documented history of holding Trulieve to a different standard with 40% of their stories in the past two years focused on rehashing negative instances at Trulieve as clickbait.”

Daniel Harrison Hunt, Bennett’s Miami-based attorney, told MJBizDaily before the settlement was disclosed that Bennett, who’s in her mid-30s, joined Trulieve believing it could be a solid career for her.

“She really wanted to work for that company,” Hunt said. “She believed in what they were doing. She wanted to make that her retirement job.

“But they clearly underpaid her for what her value was.”

Hunt declined MJBizDaily‘s request for comment on the settlement.

Common complaint

Allegations of racial discrimination are not unique to Trulieve among mainstream U.S. companies or newly founded legal marijuana businesses, many of which, including Trulieve, take great pains to address widely acknowledged ongoing racial disparities in the American marijuana industry.

Despite Black and brown people having suffered disproportionate arrest and incarceration rates during the lengthy war on drugs in the U.S. – and continuing to be arrested at a rate higher than that of whites even in states with full-on adult-use legalization – the marijuana industry remains overwhelmingly white and male.

Social equity efforts, including special licensing reserved for people with drug-arrest records or other qualifications related to the war on drugs, have not yet closed the gap.

Only 15.4% of marijuana companies nationwide were owned by racial minorities in 2022, down from 20.7% in 2021, according to MJBizDaily’s DEI report.

And social equity does little to address workplace dynamics.

Last year’s data showing that 12.1% of U.S. cannabis executives were nonwhite was well below the national average of 20.1% for all U.S. businesses, according to the Bureau of Labor Statistics.

Other multistate operators are fighting similar bias allegations.

In January, a Black former employee of Ascend Wellness sued that company in New Jersey, alleging racial discrimination.

“Whether it’s bribery schemes leading to charges, as in Michigan (recently), or hiring practices and work environments, we are seeing many of the same inequitable practices from traditional industries permeate the cannabis industry in such a way that continues to perpetuate the harm caused by the war on drugs,” said Mike Lomuto, DEI manager at the Washington DC-based National Cannabis Industry Association, which lobbies for small marijuana businesses.

“The potential good news is that we see this corruption starting to be exposed.”

Shaleen Title, an attorney and former Massachusetts state marijuana commissioner, said she “frequently” encountered discriminatory practices when she ran a cannabis recruiting firm.

“Anecdotally, Trulieve is currently one of the companies that I see the most complaints about from workers,” she added.

“This could be due to its practices, and/or it could be workers feeling empowered to speak out when they see other workers across the country speaking out and being taken seriously.”

According to her lawsuit, Bennett, who holds a college degree, earned $54,000 a year working at Trulieve’s 200-person call center in St. Petersburg, Florida.

As a manager, Bennett had access to payroll information. She discovered the company paid whites in similar roles $55,000-$60,000 a year, despite doing “less work” than Black employees, her suit alleged.

The suit also alleged the company discriminated systemically.

Black “support personnel” earned $16 an hour “while whites were making $16.50 an hour,” the suit alleged.

Whites “were paid more because of their race,” the suit alleged.

According to Bennett’s suit, after she raised her complaints with management via a formal letter, she was denied promotion and singled out for public criticism by a white superior who “did not speak to whites in this fashion.”

She was later demoted before leaving the company and the marijuana industry entirely.

Trulieve defends DEI record

In its emailed statement, Trulieve defended  its track record on promoting diversity, equity and inclusion.

“With the industry’s first female CEO of an MSO, the Trulieve leadership team has doubled down and lead the industry in our commitment to justice, diversity and inclusion efforts,” the statement noted.

“Externally, Trulieve has facilitated nearly 300 expungements for cannabis related offenses, worked with minority partnerships in states including Georgia and Massachusetts where our investments total nearly $30M … (and) more than $300K in minority nonprofit partnerships.”

In the other pending lawsuits brought by former Trulieve employees, filed in Florida in Leon and Gadsden counties as well as federal court in Tallahassee, Trulieve is accused of discriminating against disabled people and retaliating against whistleblowers reporting unsafe workplace practices.

In one such pending case, a former environmental health and safety manager claims the company fired him under false pretenses after he reported a hazardous fertilizer leak at a Trulieve grow, according to court records.

Marie Mattox, the lawyer representing plaintiffs in five of those suits, did not respond to MJBizDaily requests for comment.

Then there was the incident last summer, when Trulieve apologized for what it admitted was a “culturally insensitive promotional lineup”: promoting a sale on watermelon-, grape- and banana-flavored products on Juneteenth.

“We understand how this would appear,” the company said, in part, after critics on Reddit identified what they said was an obviously racist “joke.”

“We are continuously working through our internal processes to ensure we have the diversity of thought and inclusive representation on all our platforms.”

Corporate power player

With licenses in 10 states and roughly 7,600 employees at the end of 2022, Trulieve is one of the country’s biggest cannabis companies.

The company has a leading position in Florida, where it operated 123 dispensaries as of Dec. 31, according to annual filings.

To date, Trulieve has donated $30.5 million toward a 2024 constitutional amendment that would legalize adult-use marijuana in the state, according to campaign finance records.

In 2022, the publicly traded firm claimed more than $1.2 billion in revenue, according to an annual report filed last month.

The company also reported losing $205.2 million during that time period.

Trulieve’s shares trade on the over-the-counter markets as TCNNF and on the Canadian Securities Exchange as TRUL.

A separate open lawsuit accuses the company of violating federal labor law when it laid off an unspecified number of workers at its Florida cultivation operations as part of what the company called a “repositioning.”

Title, the former Massachusetts commissioner, said she believes state regulators should take a more active role in requiring operators to comply with federal anti-discrimination laws and create proactive diversity plans that are transparent and actionable.

“It’s never too late, and good state-specific regulations that are consistently enforced can help prevent the conduct that leads to these lawsuits.”

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