Marijuana Company Sues DoorDash, Total Wine And Others Over Alleged Illegal Sales Of Hemp THC Products

A subsidiary of a multi-state marijuana company is suing DoorDash, Total
Wine and several other businesses for allegedly violating Virginia hemp
laws by marketing cannabis products that exceed the legal THC limit.

In a lawsuit filed with the Virginia Circuit Court of Arlington County on
Wednesday, Jushi Holdings Inc. subsidiary Dalitso LLC claimed that
defendants have engaged in a “deliberate and coordinated scheme to erode
Virginia’s heavily regulated medical cannabis market” by selling
intoxicating cannabinoid products that run afoul of state law.

“Disguised as lawful ‘hemp,’ these products are, in reality, potent and
dangerous forms of marijuana, offered without the mandatory safeguards,
testing, or oversight that the Commonwealth imposes on licensed cannabis
operators such as Plaintiff,” the complaint says. “Through this deception,
Defendants have flooded Virginia’s marketplace with unregulated and illegal
cannabis products, exploiting consumer confusion and contravening
Virginia’s state statutes to gain an unlawful competitive advantage.”

The filing walks through the history of cannabis laws that led to the
proliferation of the consumable hemp market, including the federal
legalization of hemp containing up to 0.3 percent delta-9 THC by dry weight
under the 2018 Farm Bill. Then, in 2023, Virginia implemented its own law
imposing additional restrictions on what can be legally sold, with a 2
milligram THC per package requirement.

“However, despite Virginia’s efforts to establish its Total THC standard
available for purchase outside of authorized dispensaries, Defendants to
this lawsuit engaged in a conspiracy to sell hemp products and industrial
hemp extracts in Virginia that exceed the Commonwealth’s Total THC
standard,” the lawsuit—which also lists Grayscale Brewing, Specialty
Beverage and Coastalo as defendants—says.

“In Virginia, the influx of these illegal products into unregulated retail
channels directly undermines the Commonwealth’s regulated medical marijuana
program. Licensed dispensaries like Plaintiffs operate under stringent
oversight, pay substantial licensing and operational fees, and comply with
rigorous testing, packaging, and tracking requirements. Intoxicating hemp
sellers, by contrast, bear none of these costs or obligations, yet compete
for the same consumers by selling untested, unregulated, and unlawfully
potent intoxicants in violation of Virginia law.”

Jushi is asking the court for a jury trial to settle the issue, and it’s
seeking more than $80 million from defendants over the claimed economic
injury from the alleged unfair competitive advantage.

Marijuana Moment reached out to each of the defendants, but representatives
were not immediately available to comment on the lawsuit.

One of the most well-known defendants is the delivery service DoorDash,
which announced in January that it was expanding its offerings in select
states to include hemp-derived THC and CBD products, including gummies and
beverages. The company said at the time that it was partnering with
businesses such as Total Wine, another key defendant.

It remains to be seen how the lawsuit will be received by consumers and
advocates, who may view the legal challenge as an attempt to stamp out
competition by eliminating a source of cannabis products that some have
come to rely on while Virginia continues to disallow sales of recreational
marijuana, which is nonetheless legal to possess in the state.

From Jushi’s perspective, however, the lawsuit is necessary to level the
playing field and address what is sees as unfair business practices the
undermine its legal medical cannabis operations.

Trent Woloveck, chief strategy officer of Jushi, said the company’s “goal
is not to remove products that are following the law and regulations set
forth in Virginia.”

“We should ensure that businesses that want to continue to participate in
cannabis do it under what is allowed so that we can get to our end goal of
normalizing the plant. However, if businesses want to continue to short cut
the process, then we are going to shine a light on them,” he told Marijuana
Moment. “These sellers are selling intoxicating THC products without nearly
the oversight, licensing, or tax burdens borne by licensed cannabis
companies, so they ought to be extremely careful about following the law.”

“As for patient and consumers, we’ve received extremely positive support
and feedback in our fight for public health and safety,” Woloveck said.
“Unregulated and lawful marijuana products guised as hemp have created a
significant problem for those pushing for real, permanent reform of
cannabis industry because hemp-derived products are rarely (if ever) tested
with the vigor required of licensed cannabis companies.”

Use and possession of adult-use marijuana has been legal in Virginia since
2022, but retail sales remain forbidden—a situation that’s helped fuel a
multibillion-dollar illicit market. Despite efforts by Democrats in past
years to legalize and regulate the retail system, Gov. Glenn Youngkin (R)
has stood in the way of the reform, vetoing proposals passed by lawmakers
during each of the last two sessions.

Lawmakers on a legislative commission have been laying the groundwork to
push for legalization of recreational cannabis sales in the 2026 session,
but the success of that effort will likely depend on the results of next
month’s gubernatorial election. Democrat Abigail Spanberger backs the
reform but Republican Winsom Earle-Sears opposes it, and the two clashed on
the issue at a recent debate.

Hemp businesses tried to block Virginia from enforcing the intoxicating
hemp cannabinoid law in 2023, but a federal judge rejected the legal
challenge.

All of this comes as Congress and state legislatures across the country
grapple with their own hemp laws, with a growing number making moves to
either ban or strictly regulate the sale of intoxicating cannabinoid
products.

On Friday, a bipartisan coalition of 39 state and territory attorneys
general called on Congress to clarify the federal definition of hemp and
impose regulations preventing the sale of such products.

A GOP senator is hoping to replace a proposed ban on hemp THC products with
alternate appropriations language mandating a study into state regulatory
models for consumable cannabinoids. Sen. Rand Paul (R-KY) is circulating
legislative language that he’s asking to be adopted as part of the final
package.

The agriculture appropriations measure the Senate passed as part of a
package over the summer initially contained provisions hemp industry
stakeholders said would effectively eradicate the market by banning
consumable hemp products with any “quantifiable” amount of THC. But after
the measure came out of committee, Paul threatened to hold up its passage
over the issue, and the language was removed.

Sen. Mitch McConnell (R-KY), who ushered in the federal legalization of
hemp under the 2018 Farm Bill, championed the THC criminalization language
and took to the floor to criticize those who opposed the ban, including Paul
.

Meanwhile, Paul recently filed a standalone bill that would go in the
opposite direction of the hemp ban, proposing to triple the concentration
of THC that the crop could legally contain, while addressing multiple other
concerns the industry has expressed about federal regulations.

The senator introduced the legislation, titled the Hemp Economic
Mobilization Plan (HEMP) Act, in June. It mirrors versions he’s sponsored
over the last several sessions.

Separately, the retail giant Target has also started to soft launch sales
of THC-infused beverages at select stores in Minnesota.

*Read the Virginia lawsuit over alleged unlawful cannabis sales below: *

*Photo courtesy of Philip Steffan.*

The post Marijuana Company Sues DoorDash, Total Wine And Others Over
Alleged Illegal Sales Of Hemp THC Products appeared first on Marijuana
Moment.