(The Center Square) – Ohio’s attorney general has sued nine large cannabis operators for allegedly colluding to keep prices artificially high.
“Our investigation uncovered allegations of an industry-wide scheme designed to push small Ohio businesses out of the market,” Attorney General Dave Yost said in a statement. “Ohio’s antitrust laws protect competition and consumers, not backroom deals that rig the system for a select few.”
The lawsuit, filed Thursday in Franklin County, was prompted by a tip from a cannabis industry worker that the large, multi-state cannabis companies were negotiating to buy products from each other, instead of from independent Ohio growers.
Ohio voters in 2022 approved legalizing recreational marijuana for residents 21 and older.
ln just the first year of legalization, Ohio’s cannabis business reached $700 million, the lawsuit states.
“The lure of success in Ohio’s growing cannabis market has attracted large, multistate cannabis operators to eagerly clamber for Ohio consumer dollars,” according to the lawsuit. “ But these multistate operators aren’t clambering to participate in the competition; they’re actively suppressing it.”
The lawsuit seeks a permanent injunction barring the companies from continuing the alleged collusion and fines of up to $500 for each day the collusion occurred. The lawsuit also seeks attorney fees.
Companies named in the lawsuit include Ascend Wellness, Ayr Wellness, The Cannabist Company, Cresco Labs,Curaleaf, Green Thumb Industries, Jushi, Trulieve and Verano. All of the defendants are headquartered in other states.
According to the tip received by the Attorney General’s office, the companies held a meeting in late 2022 and “agreed to reduce purchases from independent businesses in order to preserve shelf space for one another during a period of increased supply and declining prices,” the Attorney General’s Office said in a statement. “The tip further alleged that some companies established explicit internal quotas, reserving a substantial percentage of dispensary shelf space for products sourced through reciprocal agreements with other multistate operators.”
