STIIIZY Lawsuits: Psychosis, Delta-8 THC, and Data Breach

STIIIZY, the Los Angeles cannabis brand that controls roughly 7% of California’s legal marijuana market, is facing a stack of active STIIIZY lawsuits and government investigations that touch nearly every part of its business. The claims include product liability suits alleging its high-potency vapes caused psychosis in teenage users, a federal class action over delta-8 THC products marketed as legal hemp, a California class action over alleged heavy-metal and pesticide contamination, litigation tied to a data breach affecting hundreds of thousands of customers, and a New York state investigation into whether out-of-state cannabis was funneled into the regulated market. None of the major cases have reached a final resolution.¹

Psychosis Lawsuits From Teenage Users

In May 2024, a California high school student identified as “John Doe” filed what was described as the first major product liability suit against a cannabis brand over public health harms. The complaint, filed in Marin County Superior Court, alleges STIIIZY deliberately marketed high-potency THC vaporizers to teenagers through colorful packaging, fruity flavors, and social media advertising. The plaintiff says he began using STIIIZY vapes at age 15 and developed cannabis-induced psychosis, with hallucinations, delusions, and erratic behavior; his physicians reportedly told him there is a 90% chance the psychosis becomes permanent if he uses cannabis again.²³ The suit names Shryne Group and Stiiizy IP and raises claims of fraud, negligence, product-design defects, and failure to warn. Plaintiff’s counsel has compared the litigation to earlier suits against Juul Labs over e-cigarette marketing.⁴

A second suit followed in early January 2025 from another “John Doe” plaintiff, a former elite high school athlete who alleges STIIIZY’s high-potency products caused psychosis requiring multiple hospitalizations and ongoing psychiatric treatment. He says he was drawn to STIIIZY vapes by their designs and flavors and still needs academic accommodations. That complaint asserts negligence, fraud, strict products liability, and breach of implied warranty. It was filed by Sarah London of Girard Sharp, who served as co-lead counsel in the Juul MDL.⁵⁶

STIIIZY spokesperson Pristina Alford called the allegations “false and inflammatory.”¹ Both cases remain in early stages.

Delta-8 THC Federal Class Action

In April 2024, Illinois resident Taylor Byron and Missouri resident Taylor Berry filed a putative class action in the U.S. District Court for the Southern District of Illinois. They allege STIIIZY sold delta-8 THC vapes and edibles as hemp products compliant with the 2018 Farm Bill, which caps delta-9 THC at 0.3% by dry weight, when the products in fact exceeded that limit. The complaint cites a “Skywalker OG Pen D8” that allegedly tested at 3.57% delta-9 THC, and argues STIIIZY used the hemp label to sidestep the tougher rules that apply to state-legal cannabis.⁷⁸

STIIIZY moved to dismiss on personal jurisdiction, the reliability of the plaintiffs’ testing, and the sufficiency of the fraud allegations. On January 29, 2025, Chief Judge Nancy J. Rosenstengel issued a split ruling. All of Berry’s Missouri-based claims were dismissed for lack of personal jurisdiction, and Byron’s negligent misrepresentation claim was tossed under Illinois’s economic loss doctrine. Byron’s three remaining claims survived: violation of the Illinois Consumer Fraud and Deceptive Business Practices Act, common law fraud, and unjust enrichment. The court cited STIIIZY’s Chicago flagship, promotional events, and dispensary sales as “sustained and intentional efforts to exploit the Illinois market.”⁷

As of mid-2026, discovery is ongoing and no motion for class certification has been filed. A final pretrial conference is set for September 2026 with a presumptive trial date in October 2026.⁹ STIIIZY has confirmed it has stopped manufacturing and distributing hemp vapes.¹

California Contamination Class Action

A separate class action in the Superior Court of California, Los Angeles County, targets STIIIZY’s parent company Shryne Group over allegations that its vape products contained undisclosed contaminants above California’s legal limits. Independent lab testing cited in the filings identified heavy metals including lead, cadmium, arsenic, and chromium, plus pesticides: bifenazate, an acaricide not approved for cannabis in California, and myclobutanil, a fungicide that converts to hydrogen cyanide when heated. The plaintiffs allege contamination came from both the cannabis oil and metal leaching from cartridge heating coils, and that products sold to consumers did not match the safety results shown on certificates of analysis.¹⁰

The complaint brings claims for product liability, consumer fraud, and violations of California’s Consumer Legal Remedies Act and Unfair Competition Law. The proposed class covers consumers who purchased STIIIZY vape products between 2018 and 2024. The case is in the class certification stage, with a ruling expected in mid-2026, and no settlement has been reached.¹⁰

The contamination claims echo a December 2023 voluntary recall by California’s Department of Cannabis Control, which pulled STIIIZY Premium THC Pods in “Pink Acai” and “Purple Punch” varieties, manufactured by Ironworks Collective, over potential pesticide contamination.¹¹

Data Breach and Consumer Suits

In late 2024, STIIIZY disclosed that an organized cybercrime group had compromised a third-party point-of-sale vendor used at four of its retail locations: Union Square and Mission in San Francisco, Alameda, and Modesto. The breach ran from October 10 to November 10, 2024, but STIIIZY was not notified until November 20. Exposed data included names, addresses, dates of birth, driver’s license numbers, passport numbers, photographs, signatures from government IDs, medical cannabis cards, and transaction histories. Roughly 380,000 individuals were notified.¹²¹³ The intrusion was reportedly claimed by the “Everest Ransomware” group.¹⁴

In January 2025, a proposed federal class action, Robert Krauth v. Stiiizy Inc., was filed in the U.S. District Court for the Central District of California, alleging the company failed to safeguard consumer data. A separate suit was filed in Los Angeles by a STIIIZY employee alleging the company took nearly three months to notify victims.¹⁵ By March 2025, the Krauth suit was voluntarily dismissed without prejudice.¹⁶

New York Product Inversion Investigation

In early 2025, the New York Office of Cannabis Management opened an investigation into whether STIIIZY and other brands were engaged in “product inversion,” the practice of routing out-of-state cannabis into New York’s regulated market through a licensed processor. The probe centers on Omnium Health (also known as Omnium Canna), a Long Island manufacturer that produced products for multiple brands. OCM inspectors began surprise audits of Omnium’s facilities in February 2025.¹⁷¹⁸

On April 23, 2025, OCM quarantined about $10 million worth of cannabis products, including vaporizers and pre-rolls, manufactured at Omnium facilities. Of those, 200 products were made in partnership with STIIIZY and another brand, mfused.¹⁹¹⁸²⁰ Omnium blamed “paperwork and clerical errors” and said all its products were sourced from New York-grown cannabis.

By October 2025, New York regulators filed administrative charges against Omnium Health seeking to revoke its manufacturing and distribution licenses, impose millions in fines, and ban it from operating in the state. OCM ordered a recall of roughly $30 million in Omnium-manufactured products, the agency’s largest to date. Acting OCM executive director Felicia A.B. Reid accused Omnium of “reverse licensing,” renting its license to unvetted out-of-state businesses. The October reporting did not name STIIIZY in connection with the administrative charges, and any specific consequences for the brand remain unclear.²¹

Allegations Against Co-Founder Tony Huang and Former CEO Jon Avidor

In December 2023, a Los Angeles Times investigation linked co-founder Tony Huang to nine properties, held through a network of holding companies, that housed unlicensed cannabis dispensaries in Southern California. The cities of Los Angeles and Compton filed civil suits alleging Huang knowingly allowed the properties to operate as underground dispensaries. In the Los Angeles case, Huang and co-defendants were ordered to pay $450,000 in civil penalties over a South LA storefront the city said had operated illegally since 2018 and was associated with gun presence and sales to minors.²²²³ STIIIZY’s spokesperson described Huang as “a landlord to a tenant accused of operating an illicit dispensary” and said he did not directly engage in illegal sales.¹

Separately, Jon Avidor, who served as CEO of Shryne Group in 2021, filed suit in September 2023 alleging the company’s co-founders operated a “sprawling enterprise of eighteen (18) or more unlicensed, illegal cannabis dispensaries” throughout California. Avidor claimed the founders used shell companies and “strawmen” to acquire properties and directed employees to staff the illicit storefronts, and said he was fired from the board in retaliation for raising concerns. His claims were supported by a sworn declaration from another board member, Raquel Origel.²³ STIIIZY president Tak Sato called Avidor a “disgruntled employee” and his claims “baseless.” The company confirmed the lawsuit was later settled under a confidential agreement and denied the allegations. STIIIZY has said Huang now maintains only an advisory role, and Sato has asserted that STIIIZY “100%” does not operate illegally, attributing the appearance of its products in unlicensed markets to counterfeits or products smuggled from licensed dispensaries by third parties.²⁴

Where Things Stand

Across every case, STIIIZY has taken a consistent public position: it is being targeted because of its size. “STIIIZY is one of the best-known companies in the industry. But that also makes us an easy target, in some people’s minds, for lawsuits,” Alford said.¹ The company has called the psychosis allegations false, challenged the plaintiffs’ testing in the delta-8 case, and stopped manufacturing hemp vapes.

None of the major matters have produced a final judgment or settlement on the record. The California contamination class action awaits class certification in mid-2026. The Byron delta-8 case is headed toward a possible October 2026 trial. The two psychosis suits remain in earlier stages. The Krauth data breach suit was voluntarily dismissed without prejudice, leaving room for new plaintiffs to file. The New York investigation continues to unfold around Omnium, with STIIIZY’s specific exposure still undefined.

1
SFGate. Stiiizy, California Cannabis Vape Brand
2
MJBizDaily. Marijuana Brand Stiiizy Hit With Lawsuit Alleging Marketing to Youth
3
San Fernando Sun. Youth at Risk of Psychosis From Repeated Cannabis Use, Research Suggests
4
The Recorder. Lawsuit Targets Stiiizy for High-Potency Cannabis Vapes, Increase in Cannabis-Induced Psychosis
5
San Fernando Sun. Former User Sues Marijuana Brand Stiiizy Alleging Products Caused Psychosis
6
Girard Sharp. Sarah London
7
Perkins Coie. Byron et al. v. Stiiizy, Inc., Opinion
8
CRB Monitor. Stiiizy Hemp Products Draw Another Federal Lawsuit
9
CourtListener. Byron v. Stiiizy, Inc. Docket
10
Lawfold. Stiiizy Lawsuit
11
Newsweek. California Weed Recall: Pesticide Contamination Warnings
12
California Attorney General. Stiiizy Substitute Website Notice of Data Breach
13
ClassAction.org. Stiiizy Inc. Data Breach Lawsuits
14
Bloomberg Law. Cannabis Company Stiiizy Hit With Class Action Over Data Breach
15
Law360. Pot Co. Stiiizy Hit With Data Breach Suit
16
Bloomberg Tax. Customer of Cannabis Company Stiiizy Withdraws Data Breach Suit
17
New York Times. New York Weed Marijuana Investigations
18
Ganjapreneur. New York Investigating Product Inversion Involving Out-of-State Cannabis Brands
19
Cultivated News. New York Orders Product Quarantine
20
MJBizDaily. New York Halts Sale of Select Cannabis Products, Inversion Suspected
21
New York Times. Cannabis Omnium
22
SFist. California’s Largest Dispensary Chain Stiiizy Accused of Running Illegal Underground Pot Shops
23
SFGate. California Cannabis Stiiizy New Allegations
24
Forbes. Inside Stiiizy, the World’s Best-Selling Weed Brand