A very big congratulations to a longtime Oregon cannabis client, and to our trial team, which just won a decisive, hard-fought victory in a nine-day jury trial in Portland, Oregon. Harris Sliwoski attorney Jesse Mondry led a stellar trial team comprised also of attorney Tom Oster, litigation paralegals Kathleen Biddle and Staci Black, and summer associate Janve Sobers.
This complex case concerned the failed merger of 26 California and Oregon cannabis companies. Harris Sliwoski’s client is a well-known enterprise that operates a chain of dispensaries and a grow operation in locations from the Oregon coast to Portland metro to Central Oregon.
In 2019, our client signed an ill-fated merger agreement with numerous California companies. This was an effort to create a multi-state operation. The deal quickly fell apart and the signatories went their separate ways. But one person, who was to receive shares in the merged entity, threatened to sue our client and others for the purported value of his shares in the merged entity. He claimed the shares were worth $7.4 million and he sought another $1.3 million in alleged compensation from our client for an alleged agreement that he would be the new company’s Chief Revenue Officer.
After receiving the threat of a being sued, our client struck first. In May of 2020, we filed a lawsuit in Oregon primarily seeking a court order holding that the purported agreement was unenforceable. The disgruntled third-party filed counterclaims against our client totaling $8.7 million.
Two hard-fought years of litigation ensued. There were multiple motions to dismiss, motions to strike, motions for summary judgment, discovery disputes, and over a dozen individual and corporate officer depositions. More than 25,000 pages of documents were produced. Our client succeeded in dismissing numerous claims throughout the process (e.g., tortious interference with contract), securing summary judgment on others (employment related), and getting the court to strike various other allegations of the counterparty.
The case went to trial before a jury in August 2022 on the $7.4 million in counterclaims against our client for breach of contract and promissory estoppel. After a nine-day jury trial, involving numerous lay and expert witnesses, the panel returned a verdict completely in our client’s favor. The judge also ruled separately in our client’s favor on the estoppel claim.
This was bet-the-company litigation for our client who, needless to say, is thrilled with the result. Congratulations!
