Many cannabis consumers are familiar with Jack Herer, an American cannabis rights activist sometimes dubbed the “Emperor of Hemp,” or perhaps they’re more familiar with the sativa-dominant strain of the same name. Herer’s legacy lives on, though his son seems to be in the middle of a new bind.
Jack’s son Daniel Herer is being sued by a former business partner who alleges that Herer “repeatedly reneged on agreements,” according to a complaint filed in Nevada state court. Herer denied the charges in the lawsuit in his own filing, arguing that the plaintiff, listed as Herer Brands Inc. (HBI), is infringing on intellectual property it doesn’t own.
According to the complaint, Herer Brands was co-founded by Daniel Herer and Dennis D’Alessio in 2002.
It also claims that, after Jack Herer’s death, Daniel began “pursuing investors and convinced them to do business with him by leveraging the value of his father’s name, embellishing his own supposed business skills, and by touting a number of highly profitable business opportunities. Unfortunately, due to and as a result of his misrepresentations and a series of bad decisions, these ventures incurred millions of dollars in debt, and the deals stalled or failed.”
The lawsuit says that rather than dealing “with his problems directly and forthrightly,” Daniel repeatedly went back on agreements while continuing to seek new investors and/or partners to payoff and replace the old ones, “not unlike an ongoing Ponzi scheme.”
The lawsuit states that in July 2022, HBI Investor Group performed a due diligence check on Herer, who had signed a deal with the company to become its chief business development officer.
According to the lawsuit, HBI ultimately determined that there were “issues” with the Jacket Herer assets after a 90-day due diligence period “that negatively impacted their value, and that the venture’s business prospects were not as strong as Daniel had represented.” As a result, the parties “negotiated and agreed to adjustments in the HBI Investor Group’s investment and equity share in the venture,” it continues.
The suit also alleges that, unbeknownst to HBI, Herer began publicly disparaging HBI and its agent to cannabis industry insiders as early as October 2022, “in an apparent effort to establish a justification for his planned departure from HBI and attempted looting of its assets.”
The suit cites an instance at an industry conference in Mexico City where Herer told Founder and Executive Director of the Marijuana Industry Trade Association Demitri Downing that HBI and its agent had “taken advantage of him, had not been honest with him, and were not capable of operating the business, thereby disparaging HBI’s reputation in the industry for honesty and
professional competence.”
Herer “repeated and intensified his slanderous statements,” the suit says, at an industry event in Las Vegas in November 2022. After the event, he allegedly notified HBI that a burglary had occurred at a third party’s facility that he chose for product packaging and manufacturing services. He was authorized to purchase a quantity of legal cannabis for a licensee to resell and was entrusted with funds for the purchase, according to the lawsuit.
Without the knowledge of HBI or the licensee, Daniel delivered the legal cannabis to an unlicensed facility and shortly after claimed that most of the product had been stolen, the lawsuit alleges.
“An investigation of Daniel’s actions was initiated by HBI for mismanagement and/or embezzlement relating to his handling of the purchase and sale of the cannabis. As a result of HBI’s investigation, it was determined that Daniel was reckless and/or engaged in a conspiracy from which he benefited, that resulted in loss of the cannabis, damages to the company, as well as potential violations of applicable laws.”
Here’s counterclaim denies all of HBI’s allegations outlined in the lawsuit, contending that D’Alessio is improperly using the Herer name and trademarks. Additionally, it claims that D’Alessio “never paid the $1,500,000 base capital investment, so the intellectual property was never transferred out of Herer Media & Publishing, Inc.”
HBI is seeking compensatory damages in an amount to be proven at trial and an injunction to prevent Herer from competing against HBI or disparaging the firm. Herer is similarly seeking compensatory damages.
The lawsuit was electronically filed in the U.S. District Court of Nevada on July 12, 2023.
