A group of investors says a Canadian cannabis producer misled them when it said it was acquiring a UK-based agricultural company that could “almost immediately” start exporting hemp and CBD products to the European Union.
Afederal lawsuit filed in New York Thursday alleges that the representations Sundial Growers, Inc. made on January 2019 were “grossly exaggerated and materially misleading.”
The lawsuit filed on behalf of a handful of investment groups says Calgary, Alberta-based Sundial told investors the company it was acquiring, Bridge Farm, had a “hemp cultivation license” that would allow them to be “first to market” in exporting to the EU, thus giving them a “stronghold in Europe’s nascent cannabis market.”
Based on those representations, the plaintiffs invested more than $4 million in Sundial before its initial public offering. But, the lawsuit says, it turned out Bridge Farm did not have the necessary licenses to cultivate or export hemp and CBD to the EU.
Sundial trades on the Nasdaq as SNDL.
The lawsuit seeks monetary damages to be determined by a jury, “but no less than $4 million.”
