A cannabis testing lab in Michigan asked a judge last week to force state regulators into mediation over a recall issued last month on cannabis products tested at two laboratories over a three-month period beginning in August.
Viridis Laboratories in Bay City and Lansing, Michigan filed a lawsuit demanding the Michigan Regulatory Agency lift its Nov. 17 recall on all marijuana products tested between Aug. 10 and Nov. 16.
“While our team has worked tirelessly to test and retest cannabis and get products safely back to market, we’re disappointed to hear that the MRA has been unresponsive to many of our inquiries and slow to help licensees get retested product released from ‘holds’ in the state’s licensed cannabis tracking system,” Viridis CEO Greg Michaud said in a news release.
[Read Viridis’ motion to compel mediation.]
An email exchange between Viridis and the MRA regarding mediation is included as exhibits in Viridis’ Motion to Compel Mediation filed Dec. 8 in the Michigan Court of Claims.
“Should Viridis have an offer of settlement, we will, of course, discuss that with our client,” Risa Hunt Scully, an assistant attorney general representing the MRA, wrote in one of the emails.
Contacted by Grown In, an MRA spokesperson declined to comment.
“Viridis’ request for mediation follows Michigan Chief Court of Claims Judge Christopher Murray’s ruling, on Viridis’ Motion for Preliminary Injunction that removed Viridis Bay City from the recall, on the grounds that all the products that allegedly failed retesting were tested at the main Viridis Lansing facility, which legally operates as a separate company.
“Sadly, the MRA has refused our offer to work out remaining issues through mediation, so we’re left with no choice but to press on with litigation,” Viridis attorney David Russell with Foster, Swift, Collins & Smith, P.C., said in the Viridis news release.
Viridis believes mediation could resolve or narrow all outstanding disputes which includes the scope of the remaining recall and the MRA’s ongoing investigations, the court document further states.
Viridis’ claims further mediation is sought since the case is already on an expedited schedule and due for trial within six months.
More than 400 dispensary owners in Michigan were left scrambling to replace impacted inventory as growers had to deal with the dispensary product returns. Viridis claimed there was no public or safety risk justifying what’s been described as the largest recall in the state’s history with an estimated $229 million in cannabis products impacted by the recall.
“As of this morning Dec. 2, we have a total percentage passing at 73 percent and a total percentage failing at 27 percent. Those samples are failing for either total coliforms, total yeast and mold, or aspergillus,” Claire Patterson, scientific and legal section manager with the MRA testified during court proceedings.
The MRA has received 18 adverse reaction complaints since the issuance of the recall ranging from serious side effects and hospitalizations to more mild allergic type reactions, according to Patterson’s testimony last week.
Viridis’ CEO, Greg Michaud, claimed on the witness stand last week that the recall is not over, that it is just starting.
“Currently we’re not seeing any cash collection,” Michaud testified. “The customers have stopped paying us and we have several hundred thousand dollars in accounts receivables. We’ve not seen any of that come in except for a little bit. In fact, we’re having checks cancelled that were sent to us. So, we’re not receiving really any revenue at this point.”
Viridis was cleared by the MRA to resume testing, according to testimony provided by both Viridis and MRA witnesses during the proceedings.
