MedMen countersues Ascend over broken N.Y. deal
Last February, Ascend agreed to acquire nearly 87% of cash-strapped MedMen’s New York state operation for $73. Ascend provided MedMen with at least $6M in cash for working capital, and upgrades to a facility in upstate New York.
- At the beginning of 2022, MedMen unilaterally terminated the deal. Ascend promptly sued MedMen. MedMen’s position, Ascend claimed, was that New York regulators had not granted final approval for the deal. Ascend described this position as “astounding” since regulators had give permission publicly and in writing.
MedMen’s countersuit claims that New York Gov. Kathy Hochul’s (D) office pressured regulators to bless the deal days after an Ascend executive attended a Hochul fundraiser.
- The fundraiser was hosted by Feuerstein Kulick, a Manhattan-based pot law firm that “advises companies on winning licenses from state governments,” the suit claims.
- Sources told the Post what some observers have speculated public that MedMen “appeared to want out of the deal and its relatively low price.”
- The deal was set to expire January 1. Hochul’s newly created Office of Cannabis Management and its Cannabis Control Board approved it on December 28.
In a statement, Ascend said “MedMen is essentially challenging the regulators’ authority and ignoring the regulations of the state’s medical program.”
- MedMen has asked the court to declare the deal termination valid and let it keep the money Ascend provided.