California-based Kushy Punch was handed a $128 million fine from the state for the allegedly illegal manufacturing of millions of cannabis gummies, according to an SFGATE report. The company is accused of producing millions of dollars worth of gummies (according to state investigators) at an unlicensed facility in Los Angeles.
Specifically, the case is tied to a 2019 investigation into Vertical Bliss, the former owner of the Kushy Punch brand, which discovered some $64 million worth of gummies had been manufactured for the brand at an unlicensed facility. Regulators noted it was a rare instance of cannabis diversion where illicit products were making it into the legal market when the opposite — legal products entering the illicit market — is far more common.
Nicole Elliott, the director of California’s Department of Cannabis Control (DCC), said the judgment demonstrates that illicit cannabis sales “will not be tolerated in California.”
“DCC and our partners will do everything in our power to protect consumers and maintain the integrity of California’s legal cannabis market. We applaud the Court for its commitment to enforcing the rule of law in California’s cannabis industry.” — Elliott, in a press release
The $128 million penalty — potentially the largest cannabis fine ever in California — was announced on Monday by a Los Angeles-based judge after the defendants in the case failed to provide any legal defense, the report said.
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