Curaleaf Lawsuit: $31.8M Verdict, Sixth Circuit Appeal, and More

Curaleaf Holdings, Inc., one of the largest cannabis companies in the United States, is currently involved in several notable lawsuits. The Curaleaf lawsuit drawing the most attention is Hello Farms Licensing MI, LLC v. GR Vending MI, LLC, a Michigan breach-of-contract case that produced a $31.8 million jury verdict in February 2025 and is now on appeal before the Sixth Circuit. Curaleaf is also defending an Illinois whistleblower suit tied to its Litchfield cultivation facility, prosecuting its own federal challenge to New Jersey’s labor peace agreement rules, and facing workplace discrimination complaints in New York. A 2019 securities class action over CBD marketing was dismissed in 2021.

The $31.8 Million Hello Farms Verdict

The Hello Farms case began with a 2020 contract in which Hello Farms Licensing MI, LLC agreed to supply more than 50,000 pounds of medicinal cannabis to GR Vending MI, LLC, a Curaleaf subsidiary, across two annual harvest seasons. Hello Farms alleged Curaleaf failed to pay for the first harvest and then repudiated the deal before the second, a breach under Article 2 of the Uniform Commercial Code.¹

Hello Farms sued in Michigan state court. Curaleaf removed the case to the U.S. District Court for the Eastern District of Michigan in March 2021, invoking diversity jurisdiction.² U.S. District Judge Matthew F. Leitman was assigned the case.³

After a trial lasting more than two weeks, a federal jury deliberated for roughly one hour and returned a unanimous verdict in February 2025, awarding Hello Farms $31.8 million in economic damages.⁴¹ In May 2025, the court added approximately $5 million in interest, pushing the total judgment to nearly $37 million. Judge Leitman also issued an order restraining Curaleaf from transferring assets while post-trial motions were pending.

The Sixth Circuit Appeal Over Federal Illegality

Curaleaf first asked Judge Leitman to set aside the verdict or grant a new trial, arguing the underlying contract was void because marijuana remains a Schedule I substance under the Controlled Substances Act.⁵²⁴

Judge Leitman had rejected that reasoning at trial. Applying what he described as a public-policy doctrine, he pointed to the Rohrabacher-Farr amendments, annual spending riders barring the Department of Justice from prosecuting state-compliant medical marijuana businesses, and concluded that Congress’s stance on marijuana was ambiguous enough to allow enforcement of the contract.²

Hello Farms has urged the Sixth Circuit to uphold the verdict, arguing federal illegality alone does not void the contract.⁶ Oral argument was held on June 2, 2026, and the case was submitted for decision. No ruling had been issued as of mid-2026.⁷ The outcome could influence how federal courts across the country treat contract enforcement in the cannabis industry.

Illinois Whistleblower Case Over the Litchfield Facility

In July 2025, Matthew Kalmick, a former regional compliance director, sued Curaleaf in the U.S. District Court for the Northern District of Illinois (Case No. 1:25-cv-08893), alleging retaliation for reporting compliance failures at Curaleaf’s Litchfield, Illinois cultivation facility.⁸

The complaint says Illinois Department of Agriculture officials flagged a “vast amount of unaccounted-for inventory” at Litchfield and suspected “systemic diversion” of cannabis outside the regulated supply chain. On February 14, 2024, state regulators halted all product shipments from the site. Inspectors also cited unlicensed pesticide use, improperly stored chemicals, obstructed emergency exits, and inadequate personal protective equipment. Kalmick alleges he raised these problems roughly a dozen times with company leadership, including Senior Vice President Paul Chialdikas and former CEO Matt Darin, and was fired on May 20, 2024, in retaliation for his internal reports and his communications with state regulators.⁸

On February 2, 2026, Judge Jeffrey T. Gilbert largely denied Curaleaf’s motion to dismiss. He dismissed a claim under Section 10 of the Illinois Whistleblower Act, finding no private right of action, but allowed the Section 15(b) retaliation claim to move forward, concluding the complaint adequately alleged Kalmick was punished for reporting violations to state agencies including the Illinois Attorney General’s Office and the Department of Agriculture.⁹ The case remains active.¹⁰

New Jersey Labor Peace Agreement Lawsuit

On October 9, 2025, Curaleaf filed suit against the New Jersey Cannabis Regulatory Commission in the U.S. District Court for the District of New Jersey (Case No. 3:25-cv-16397), arguing that the state’s requirement that cannabis companies maintain labor peace agreements with unions is preempted by the National Labor Relations Act.¹¹¹²

The dispute followed the April 2025 expiration of Curaleaf’s labor peace agreement with United Food and Commercial Workers Local 360, which was not renewed. In August 2025, New Jersey regulators fined the company $610,000 for operating without an active agreement and threatened additional penalties of $5,000 per day. Renewal of Curaleaf’s Bordentown store permit was conditioned on securing a new agreement by October 31, 2025, raising the possibility of license revocation, which Curaleaf called “the commercial equivalent of the death penalty.”¹¹

On May 27, 2026, Judge Michael A. Shipp denied Curaleaf’s request for a preliminary injunction, finding the company had not shown irreparable harm and noting its “slow movement” had undermined its position. Even so, the judge “appeared skeptical that the regulation was allowed under federal law,” leaving the underlying preemption argument in play as the case continues.¹³¹⁴

The 2019 CBD Securities Class Action

On July 22, 2019, the FDA issued a warning letter accusing Curaleaf of marketing CBD products as unapproved drugs in violation of the Federal Food, Drug, and Cosmetic Act. The letter cited unsubstantiated health claims about treating conditions including cancer, Alzheimer’s disease, opioid withdrawal, and pain. Curaleaf’s stock fell more than 7%, closing at $7.40 per share.¹⁵¹⁶

Investors filed In re Curaleaf Holdings, Inc. Securities Litigation (Case No. 1:19-cv-04486) in the Eastern District of New York on August 5, 2019, on behalf of shareholders who bought stock between November 21, 2018, and July 22, 2019. They alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act over statements about the therapeutic benefits and regulatory status of the CBD products.¹⁵

District Judge Brian M. Cogan dismissed the case on February 16, 2021. The court found that Curaleaf had adequately disclosed the risks of operating without FDA approval and that the warning letter was a “materialization of disclosed risks” rather than newly revealed information. Leave to amend was denied as futile. Curaleaf had removed the contested marketing claims and discontinued the flagged products within days of receiving the letter.¹⁵¹⁷ That case is closed.

Discrimination Complaints and Other Litigation

In September 2025, two verified complaints were filed with the New York State Division of Human Rights alleging sex and gender identity discrimination and retaliation at Curaleaf’s cultivation facility in Ravena, New York. The complaints, brought by a transgender employee through the Law Office of David H. Rosenberg, P.C., describe a hostile work environment involving transphobic remarks by supervisors, misgendering and deadnaming, unwanted sexual comments, and retaliation that included denied transfer requests and false accusations. They name Curaleaf, operating as Focused Employer Inc., along with several individual supervisors, and remain pending.¹⁸

Earlier employment cases include a 2021 whistleblower and racial discrimination suit filed by a former cultivation employee in New Jersey state court.¹⁹ In January 2025, Crain’s New York Business reported that Curaleaf was facing “several lawsuits” alleging a toxic work culture for women.²⁰

On the corporate side, Curaleaf was sued in the Delaware Court of Chancery by a representative of the sellers in its acquisition of Tryke Companies, over what the sellers described as a unilateral $13 million price cut to a merger agreement valued at more than $85 million.²¹

1
Michigan Lawyers Weekly. Jury Verdict in Cannabis Supply Lawsuit Challenged on Appeal
2
Reason Foundation. Cannabusiness Lawsuit Highlights Need for Congress to Clarify Federal Treatment of Marijuana
3
CourtListener. Hello Farms Licensing MI LLC v. GR Vending MI LLC
4
PR Newswire. Hello Farms v. Curaleaf Appealed to US Court of Appeals for the Sixth Circuit
5
Law360. Curaleaf Cos Say Illegal Contract Nixes Farm’s $32M Verdict
6
Law360. Pot Farm Says 6th Circ. Shouldn’t Nix $32M Curaleaf Verdict
7
CourtListener. Hello Farms Licensing MI LLC v. GR Vending MI LLC – Oral Argument
8
MJBizDaily. Lawsuit: Illinois Suspected Systemic Diversion at Curaleaf Cultivation
9
Law360. Curaleaf Can’t Ditch All Ill. Whistleblower Act Claims
10
CourtListener. Kalmick v. Curaleaf Inc.
11
MJBizDaily. Marijuana MSO Curaleaf Sues New Jersey to Avoid Death Penalty
12
Law360. Curaleaf Says NJ’s Pot Shop Union Requirement Bucks NLRA
13
Bloomberg Law. Judge Upholds NJ Cannabis Labor Peace Requirements for Now
14
CourtListener. Curaleaf Holdings Inc. v. New Jersey Cannabis Regulatory Commission
15
A&O Shearman. Eastern District of New York Dismisses Putative Class Action Against Cannabis Operator
16
Cannabis Business Times. Bragar Eagel and Squire PC Is Investigating Curaleaf Holdings Inc. on Behalf of Stockholders
17
Skadden Arps Slate Meagher and Flom LLP. In re Curaleaf Holdings Inc. Securities Litigation
18
David H. Rosenberg, P.C. Discrimination and Retaliation Allegations Filed Against Curaleaf
19
Law360. Curaleaf Hit With Whistleblower, Racial Bias Claims in NJ
20
Crain’s New York Business. Curaleaf Faces Lawsuits Creating Toxic Work Culture for Women
21
Law360. Cannabis Co. Curaleaf Sued Over Haircut to $85M Merger