Scotts Miracle-Gro Sues TerrAscend Over New York Cannabis License
February 14, 2023The cannabis subsidiary of garden products company Scotts Miracle-Gro is suing multi-state cannabis operator TerrAscend’s CEO, alleging attempts on his part to undermine its acquisition of a cannabis license in New York state.
The lawsuit, filed in federal court in Manhattan, is convoluted. It begins with RIV Capital, a Toronto-based firm that last year announced its purchase of Etain Health, one of the 10 vertically integrated medical marijuana companies in New York, for a total consideration of $247 million. RIV is backed and funded in part by Hawthorne Collective, a subsidiary of Scotts that is focused on the cannabis industry. But RIV’s leading shareholder is TerrAscend executive chair Jason Wild, who allegedly had competing interests in the Etain deal. He allegedly tried to stop RIV’s acquisition for TerrAscend’s benefit. The deal closed in December.
The suit alleges that Wild pressured RIV’s board to call off the deal and made several gambits to thwart it including suing RIV in Canada and attempting a takeover maneuver of RIV’s board to oust three Hawthorne representatives. The suit alleges these actions violate the Clayton Act antitrust law.—Danny Sullivan
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