Planet 13 Holdings (CSE: PLTH), a vertically-integrated multi-state cannabis company, offered a detailed update on recent legal developments and ongoing efforts to reclaim funds.
The company’s predicament traces back to a dispute unrelated to its operations. On June 20, 2021, Planet 13 enlisted the services of El Capitan Advisors, Inc., a registered investment advisor with the SEC, for cash management. However, Casa Verde Capital, L.P. and Casa Verde Capital EF, L.P., obtained a $35.0 million default judgment against El Capitan, leading to a levy on approximately $5.5 million of Planet 13’s funds held at BridgeBank, a division of Western Alliance Bank (WAB), managed by El Capitan.
Planet 13 promptly filed a third-party claim of exemption, asserting rightful ownership over the funds. A partial settlement with Casa Verde has been secured, resulting in the release of $3.4 million on January 16, 2024. The remaining $2.1 million remains under the possession of the Orange County, California Sheriff’s Office pending ongoing litigation, with a hearing scheduled for April 29, 2024.
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Additionally, the company took immediate action to withdraw the remaining $16.5 million held in two additional accounts managed by El Capitan. However, issues arising from the Casa Verde judgment halted the process, and El Capitan has since refused further withdrawal requests.
Planet 13 believes the additional funds were misappropriated and has initiated a lawsuit seeking compensatory damages and other relief against El Capitan, its founder and CEO Andrew Nash, Casa Verde, Casa Verde’s Managing Member Karan Wadhera, and Jamie Nash, Andrew Nash’s spouse.
In response to these challenges, the company emphasized its commitment to pursuing all legally available means to recover the entrusted funds. Legal counsel has been engaged, and an internal investigation is underway. Despite potential near-term expenses, Planet 13 does not anticipate a material impact on its current business operations or its ability to fund ongoing operations.
Information for this briefing was found via the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
