California Cannabis Company Files RICO Lawsuit Against City and Former Officials

A California cannabis company has filed a RICO lawsuit against the city of Baldwin Park and some former city officials, alleging that local government had rigged the city’s retail cannabis rollout to benefit officials and their allies.

Full story after the jump.

A California cannabis company is suing the city of Baldwin Park and several officials under the federal Racketeer Influenced and Corrupt Organizations Act, or RICO, alleging that the city’s rollout of retail cannabis was rigged to benefit the officials and their allies, the San Gabriel Valley Tribune reports. The lawsuit appears to be the first of its kind – a cannabis company suing government officials under RICO. 

The federal lawsuit, filed on January 18 by David Ju, names Baldwin Park, former City Attorney Robert Tafoya, former Deputy City Attorney Anthony Willoughby II, former Councilmember Ricardo Pacheco, former Compton Councilmember Isaac Galvan, former Baldwin Park Mayor Manny Lozano, and former Chief Deputy Cty Clerk Lourdes Morales as defendants. 

In the lawsuit, attorney David Torres-Siegrist alleges the defendants “acted in concert to orchestrate a swindle on an elderly man dying of cancer who poured his life savings into a venture that was destined for failure from the get-go and nothing more than a collusive scheme marred by bribery and corruption.”   

“Plaintiffs allege that the pattern has been one of racketeering activity involving multiple criminal acts, including but not limited to, bribery, kickbacks and other improper relationships throughout the application and granting process, as well as defrauding individuals, such as plaintiffs, through the use and abuse of their positions within the city.” — Torres-Siegrist, in the lawsuit, via the Tribune.   

In 2020, the Federal Bureau of Investigation executed search warrants at Tafoya’s office and at the homes of Galvan and San Bernardino County Planning Commissioner Gabriel Chavez as part of a cannabis-related corruption inquiry. Chavez agreed to a plea deal last October on federal bribery charges and agreed to work with authorities, according to a Pasadena Star News report.  

Pacheco ultimately agreed to a plea deal with federal investigators where he claimed under penalty of perjury that Galvan and Tafoya were involved in his efforts to solicit bribes from cannabis companies looking to operate in Baldwin Park, the Tribune reports. 

Ju’s lawsuit alleges that Willoughby II paid less than $40,000 to obtain the development agreement for cannabis company Tier One and then sold it to Ju for “hundreds of thousands of dollars” and paid Galvan $50,000. Tier One had received approval to operate in the city but was unable to move forward because Baldwin Park’s cannabis ordinance prohibited ownership transfers of cannabis firms.  

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