“These nine multistate operators have a history of using these cartels to harm cannabis competition in other states, not just Ohio,” the lawsuit says.
Ohio Attorney General Dave Yost has filed a lawsuit accusing nine cannabis companies of engaging in anti-competitive practices intended to keep prices as high as possible.
In a press release, Yost’s office said that the lawsuit is predicated on a tip received in October 2024. The unidentified tipster, described as an “Ohio cannabis industry employee,” claimed that large, vertically-integrated dispensaries appeared to be collaborating through widespread “shelf-space allocations.”
An investigation later determined that the nine companies named as defendants in the lawsuit “entered into reciprocal purchasing agreements—negotiated at a national level—to prioritize one another’s products in Ohio dispensaries while reducing or eliminating purchases from independent Ohio cultivators and processors.”
Yost says that these alleged practices come at a steep cost to consumers and small businesses alike.
“Our investigation uncovered allegations of an industry-wide scheme designed to push small Ohio businesses out of the market,” Yost said in a statement. ‘Ohio’s antitrust laws protect competition and consumers, not backroom deals that rig the system for the select few.”
The attorney general’s office notes that the anonymous tipster had reported that representatives from several large, multistate cannabis operators met in late 2022. During the meeting, they agreed to reduce purchases from independent retailers to preserve shelf space for one another during periods of increased supply and declining prices. The tipster also alleged that some dispensaries had established explicit internal quotas, which are used to reserve a substantial percentage of all available shelf space for products sourced through reciprocal agreements.
The companies named as defendants in the lawsuit include:
- Ascend Wellness
- Ayr Wellness
- The Cannabist Company
- Cresco Labs
- Curaleaf
- Green Thumb Industries
- Jushi
- Trulieve
- Verano
Yost has described these nine companies as “cartels” that actively conspired to control and restrict consumer access to cannabis products made by small Ohio businesses.
“These cartels achieve this objective through quid-pro-quo supply agreements, sharing of competitively sensitive non-public information, and discriminatory distribution practices,” the lawsuit alleges. “These cannabis cartels’ goal is straightforward: eliminate independent Ohio rivals and keep Ohio cannabis prices artificially elevated compared to declining prices in other states.”
“These nine multistate operators have a history of using these cartels to harm cannabis competition in other states, not just Ohio,” the lawsuit adds. ‘They have systematically leveraged their operations in other states to diminish competition, and now they are applying the same anticompetitive strategies in Ohio. Until now, the cartels’ activities have gone unchallenged.”
The lawsuit seeks remedies including a court order prohibiting the companies from engaging in similar practices; forfeitures of at least $500 for each day on which illegal “combinations” occurred; and other damages, along with attorneys’ fees and legal costs.
Sources
Yost Sues Multistate Cannabis Operators for Anti-Competitive Practices
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