Cannabis

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Sarah Abrams

In the following guest post, Sarah Abrams, Head of Claims Baleen Specialty, a division of Bowhead Specialty, takes a look at the D&O underwriting issues associated with Real Estate Investment Trusts (REITs), in the context of a pending securities class action lawsuit involving a cannabis-focused REIT. I would like to thank Sarah for allowing me to publish her article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Sarah’s article.Continue Reading Guest Post: High on REITs

For the last several years, securities class action lawsuits related to SPACs and de-SPACs have been a significant factor in the overall annual number of securities suit filings. SPAC-related suits remain a significant factor in the number of filings again this year, even though it has now been several years since the peak of the SPAC frenzy. In the latest example, on October 17, 2024, a plaintiff shareholder filed a securities suit against cannabis company WM Technology alleging that both prior to and following its predecessor company’s merger with a SPAC, the company misrepresented a key customer engagement metric. The new lawsuit has some interesting features, as discussed below. A copy of the complaint can be found here.Continue Reading Cannabis Company Hit With SPAC-Related Securities Suits

As I have detailed in prior post on this site (most recently here), in recent months plaintiffs’ lawyers have filed a number of securities class action lawsuits against companies in cannabis-related businesses. According to an April 22, 20202 report from the Goodwin Procter law firm entitled “Update on Securities Litigation Against Cannabis Companies” (here), the number of securities suits against cannabis companies jumped significantly in 2019 compared to 2018. As discussed further below, these litigation trends have continued in 2020.
Continue Reading A Closer Look at Securities Suits Against Cannabis Companies

Samantha Wu

In prior posts, I have noted the series of U.S. securities class action lawsuits that have been filed recently against publicly traded companies in the cannabis business, including several Canadian companies. In the following guest post, Samantha Wu of the Bersenas Jacobsen Chouest Thomson Blackburn law firm in Toronto provides an overview of the unique exposures that directors and officers of Canadian cannabis companies face. A version of this article previously was published on the law firm’s website (here). I would like to thank Sam for allowing me to publish her article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Sam’s article.
Continue Reading Guest Post: Canadian Cannabis Companies’ Directors and Officers Face Unique Exposures

On November 21, 2019, when a plaintiff shareholder filed a securities class action lawsuit against Aurora Cannabis, Inc. and certain of its directors and officers, the company became the latest U.S.-listed Canadian cannabis company to be hit with a U.S. securities class action lawsuit. The lawsuit against Aurora came just one day after a different claimant launched a separate U.S. securities lawsuit against another Canadian-based and U.S.-listed cannabis company, Canopy Growth. These two companies join a growing list of cannabis-related firms that have been hit with securities suits this year. As discussed below, these cannabis-related company lawsuits are one of several factors contributed to the continued elevated level of securities class action lawsuit filings in the U.S.
Continue Reading A Rash of Cannabis-Related Securities Class Action Lawsuits

One of the things that happened both in the lead up to and in the wake of the October 2018 legalization of cannabis-based products in Canada is that a number of Canada-based cannabis companies listed their shares on U.S. securities exchanges. From the outset, D&O insurers have regarded the cannabis companies as a distinct risk and as a tough class of business. Earlier on, there were relatively few claims to substantiate these concerns. However, there have now been a number of securities class action lawsuits filed against U.S.-listed Canadian companies, with the latest lawsuit filed just this week.
Continue Reading Ontario-Based Firm is Latest Canadian Cannabis Company Hit with U.S. Securities Suit

Paul T. Curley

One of the more interesting businesses to emerge in recent years has been the legal marijuana industry. Because of lingering legal issues, this industry’s emergence has been accompanied by a host of complications. These complications in turn raise a number of challenges for insurers seeking to get involving in this industry. In the following guest post, Paul T. Curley takes a look at the opportunities and challenges for insurers in connection with the legal marijuana industry. Paul is a partner in the Insurance Coverage and Coverage Litigation Group at Kaufman Borgeest & Ryan LLP. I would like to thank Paul for allowing me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Paul’s article.
Continue Reading Guest Post: Marijuana:  Big Opportunities and Challenges for Insurers

For those of us involved in day to day D&O insurance transactions, it is a recognized fact that cannabis-related companies represent a tough class of insurance business. Different insurers take different approaches to the business, but at best it is a risk class that most carriers approach warily. There are reasons for the caution, mostly having to do with questions relating to legality across and between jurisdictions. The question of potential claims is a little less certain, as there arguably are relatively few claims examples. However, a recent securities class action lawsuit involving a Canadian-based cannabis business may provide some insight into the kinds of claims in which these kinds of companies may become involved – at least those that are publicly traded.
Continue Reading Plaintiffs Files Cannabis-Related Securities Class Action Lawsuits