Gov. Kathy Hochul’s office pushed to force the bargain-priced buyout of a well-positioned cannabis retailer just days before it was set to wriggle out of the deal — and just days after the lucky acquirer attended a fundraiser for Hochul, according to an explosive lawsuit.
Gov. Hochul’s administration used improper influence late last month to help recreational pot seller Ascend Wellness seal its $75 million deal to buy the MedMen marijuana dispensary chain, the suit filed on Monday claims.
Specifically, MedMen’s lawsuit alleges that Hochul’s office pushed regulators to OK the controversial deal after dragging their feet for nearly a year — and just days after one of Ascend’s executives attended a fundraiser for Hochul’s reelection campaign.
The fundraiser was hosted by Feuerstein Kulick, a Manhattan-based firm that is reportedly a “major player in the field of cannabis law” that “advises companies on winning licenses from state governments,” the suit claims.
Sources said MedMen appeared to want out of the deal and its relatively low price — whose terms were set to expire on Jan. 1 if state officials took no action — after Hochul made the statewide rollout of retail marijuana shops a priority after taking office in August.
That’s because the potential value of MedMen — one of just 10 dispensaries licensed to sell medical marijuana in the state — likely soared as she accelerated from the more cautious pace set by ex-Gov. Andrew Cuomo after state lawmakers legalized pot last spring.
The Dec. 8 fundraiser, held at the posh Vandy Club in Midtown overlooking Grand Central Terminal, “specifically targeted” companies looking to enter New York’s newly legalized recreational marijuana market, the suit claims.
According to an email obtained by the Albany Times-Union, Feuerstein Kulick attorney Nancy Baynard encouraged attendees to give $10,000 each, saying the firm was in touch with the “director of finance for Hochul’s administration/campaign.”
Among those who attended the event was Ascend President Andrew Brown, the suit filed in New York state Supreme Court claims.
Two days later on Dec. 10, Hochul’s secretary Karen Persichilli Keogh and two other aides — Neysa Alsina and Kathryn Garcia, the former Democratic mayoral hopeful — met with Ascend CEO Abner Kurtin and other company reps, according to the suit.
On Dec. 28, Hochul’s newly created Office of Cannabis Management and its Cannabis Control Board approved of the deal.
“The meeting between Ascend CEO Kurtin and senior state executive officials just two days later” and the approval of the transaction shortly afterward “together raise a clear inference of improper influence by Ascend on the state approval process,” MedMen alleges in the suit.
A Hochul spokeswoman denied that a meeting took place in a statement to The Post.
“These allegations are full of falsehoods, including a meeting that never took place,” the spokeswoman said. “None of the Governor’s senior team members named here have ever met with these individuals.”
On Jan. 2, MedMen informed Ascend that it was terminating the agreement, claiming that the December resolution “did not satisfy the conditions” of the original deal. MedMen, which is represented by Quinn Emanuel Partner Alex Spiro, is asking a judge to reject Ascend’s request for an injunction that would prevent MedMen from scrapping the merger.
Ascend issued a statement saying it was blindsided by MedMen’s refusing to close the deal, adding, “MedMen is essentially challenging the regulators’ authority and ignoring the regulations of the state’s medical program.”
The Office of Cannabis Management said it wouldn’t comment “on pending or potential litigation.”
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