Civil Lawsuit Accuses Arkansas' Largest Cannabis Testing Laboratory of Conspiring with Cultivators to Inflate THC Levels

In late February 2023, medical cannabis patient Jakie Hanan filed a civil lawsuit in Arkansas against three cannabis cultivators and one testing laboratory alleging collaboration to inflate tetrahydrocannabinol (THC) levels in cannabis products. The suit names cultivators BOLD Team LLC, Osage Creek Cultivation, LLC, and Natural State Medicinals (NSM) and testing laboratory Steep Hill in the litigation, alleging that Steep Hill inflated the THC listed on the cultivators’ labels (1).

Hanan, who had been prescribed medical cannabis for his chronic pain, alleges that in 2022 he purchased cannabis products cultivated from the three growers, but they did not adequately provide the relief he expected so he had the products tested (2). Hanan tested some cannabis at a different laboratory and found that the Steep Hill’s test results on the product labels significantly exaggerated THC content (2). “To further investigate, Plaintiff, and others, tested products from Arkansas cultivators using multiple state-approved labs,” the suit reads. “For flower samples, over thirty (30) potency results were collected and compared, primarily from Jan 2021 to February 2023…Excluding Steep Hill, local labs produced results within 10% or better of each other. Steep Hill’s results averaged 25%+ higher than the other labs,” (2).

“Marijuana flower with higher concentration of THC is more valuable,” the suit continues (2). “So there is incentive to exaggerate the THC content of flower — it can be sold for more money. As a result, cultivators often choose a lab that reports the highest THC value, a phenomenon known as ‘lab shopping.’”

Steep Hill denied the allegations (1). “We are an ISO-accredited lab and have our processes audited each and every year by reputable 3rd parties, which we’ve done since we’ve been in business,” said Steep Hill CEO and co-owner Brandon Thornton (1). “We stand behind the quality, integrity and efficacy of our lab, employees and impartial test results.”

In July 2022, Hanan had filed a federal class-action lawsuit against these four companies with allegations under the Racketeer Influenced and Corrupt Organizations (or RICO) Act (3).

References

1. https://arkansasadvocate.com/2023/02/27/patient-sues-arkansas-medical-marijuana-growers-lab-over-alleged-thc-inflation/
2. https://arkansasadvocate.com/wp-content/uploads/2023/02/thc_inflation_suit.pdf
3. https://mjbizdaily.com/4-arkansas-marijuana-companies-hit-with-rico-suit-over-alleged-thc-inflation/