The cannabis industry has been a roller coaster of ups and downs, but recent news out of Pennsylvania is yet another example of a former titan from another industry thinking they could just come into the cannabis space and be successful.
William “Beau” Wrigley Jr., the former chewing gum magnate, was part of a company with high expectations for success with the Goodblend brand. However, after a series of failed promises and unpaid debts, a Pennsylvania judge has ordered the dissolution of the former Wrigley owned cannabis company.
Wrigley Owned Cannabis Ventures
William “Beau” Wrigley Jr. is a former chewing gum magnate who took over as the CEO of Florida-based cannabis company Surterra Wellness in 2018. Rebranding it as Parallel, the company expanded to five states, including Pennsylvania, where they opened retail dispensaries under the Goodblend brand in 2021.
Under Wrigley’s leadership, Parallel was on track to expand its reach even further, thanks to a plan to take the company public via a special purpose acquisition company. However, Wrigley stepped down as CEO in November 2021 after the plan fell through.
A series of lawsuits have since marred the collapse of Wrigley’s cannabis empire. Investors sued Parallel, claiming the company failed to vet its key tenants, including Goodblend Pennsylvania, properly.
Details of Non-Payment of Rent and Penalties
The lawsuit filed by IIP against Goodblend Pennsylvania alleged that the company had failed to pay $5.8 million in rent on a nearly 350,000-square-foot facility in Pittsburgh, per Green Market Report and Law 360.
Goodblend’s majority owner, Surterra Holdings, announced early this year that it would shut down its Pennsylvania operations.
Goodblend Pennsylvania’s abrupt closure left a trail of unpaid debt and unfulfilled promises in its wake. The company was on the hook for a 20-year lease worth $68 million on their Pittsburg facility, but they had no way to pay it off after closing down two dispensaries and laying off over 75 employees.
Judge Christine Ward of the Allegheny County Court of Common Pleas directed Surterra Holdings, the majority owner of Goodblend. That the company must be dissolved and its assets sold—including whatever medical marijuana remained—to be “distributed among its creditors and members.” In order to recoup as much money as possible for those owed by Goodblend Pennsylvania.
Unforgiving Industry of Cannabis
The collapse of William “Beau” Wrigley Jr.’s cannabis company serves as yet another example of a titan from another industry thinking they could just come into cannabis and turn profits immediately. In addition, this case showcases how some companies underestimate the complex and ever-changing legal landscape of the cannabis industry.
This ruling should serve as a cautionary tale for those considering entering the legal cannabis business. This is a seriously demanding industry that requires strategic planning, thorough due diligence, and total commitment to succeed. Companies must ensure they have the resources and expertise necessary to comply with all applicable laws and regulations.
Ultimately, the dissolution of Goodblend serves as a reminder to those in the cannabis industry that success rarely comes overnight. And those who need to take the necessary steps to ensure compliance could find themselves in hot water further down the road.