Cookies Cannabis Brand Faces Multiple Lawsuits
The leading cannabis brand Cookies is in the center of several lawsuit allegations as of recently. A retail partner accused Cookies for misrepresentation and fraudulent activities. A lawsuit filed in California Superior Court in Orange County in January, accuses the Cookies brand of breaching California franchise law.
Cookies Retail LLC has been accused of misrepresentation and is sued for damages of up to $100 million, according to California court records.
Publicly known as Cookies, the famous cannabis brand is actually made of multiple legally distinct entities. The business includes San Francisco Bay Area-based Cookies SF, associated with Gilbert Milam Jr. aka Berner, the brand’s co-founder, who’s also a rapper and an influencer.
Then, there are other, independently owned companies. One of them is Cookies Retail of Newport Beach, which has an agreement with Berner’s company to run Cookies-branded retail shops.
The Newport Beach operator is run by Brandon Johnson, who is also the co-founder and CEO of TRP, a cannabis cultivation, production and distribution firm that operates cannabis stores under other brand names in 14 states.
The franchise dispute is playing out between these two business entities.
Cookies $100 Million Dollar Dispute
Johnson and Cookies Retail filed the lawsuit in the Orange County court on January 12, 2024. The case states that Johnson’s business entity signed licensing agreements with Berner’s business four years ago.
The agreement sought to enable Johnson and his companies to open Cookies-branded weed stores in six states, including California.
Johnson’s Cookies Retail reportedly invested over $100 million for the brand’s expansion.
In its suit, the Newport Beach company names nine other business entities as defendants, as well as the entire Cookies C-suite.
The lawsuit alleges that Cookies Retail has been misled on a number of business-related matters by the Defendants.
Among the claims filed are violations of federal and state franchise laws and fraudulent representations. Cookies Retail alleges that it invested in 33 Cookies-branded stores, but they were ill-informed over the profitability of Cookies stores and the cost to open a store, among other claims.
The Orange County court case further suggests that Milam and other executives interfered in day-to-day activities of its partner, including hires, marketing and inventory.
The suit alleges that Milam’s Cookies controlled every aspect of important events such as grand opening of new shops. The Defendant meddled in guest lists, or which artists and security guards should be hired on the occasion.
Cookies Retail were also forced to purchase Cookies branded weed products, it also stands in the allegations.
Cookies Lawsuit Saga Started Long Before That
The Orange County case followed shortly after Cookies Retail filed a lawsuit against Milam’s Cookies in New York.
The New York case rests on intellectual property allegations. Namely, Cookies breached an agreement that would offer Cookies Retail exclusive trademark rights to use name of cannabis strains or the brand’s signature “C” logo.
At the center of this dispute is Culture House, a New York marijuana dispensary situated in Manhattan’s Herald Square.
Cookies Retail alleges that the store, which is operated by a licensee under the state’s Conditional Adult-Use Retail Dispensary Licenses, is using the Cookies trademark in violation of the exclusive rights agreement.
Those would not be the only lawsuits that Cookies is currently facing in courts around the country, however.
Last year, the self-proclaimed first $1 billion dollar cannabis company was sued by its own investors, who asserted that Milam and other Cookies executives milked investor money for personal use.
One of the cases claims that Cookies C-suite misused up to $23 million in investment cash.
While everyone is waiting for the outcome of these court cases, Cookies has continued its expansion. The brand recently added a new store in Los Angeles, and its disputed Manhattan-based Culture House has just opened its doors for customers in February.
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Stephen Andrews
