WORKWEEK

Okay, y’all. Here’s the truth. 

I had a glorious time covering the downfall of MedMen in a previous Green Paper. 

I don’t enjoy watching people fail. I’m not evil, but Adam Bierman and Andrew Modlin aren’t simply poor old execs down on their luck. 

The MedMen founders have been dubbed everything from the industry’s worst-ever executives to the cannabis twins of terror. 

They aren’t brothers, but their bad habits are uncannily similar.

MedMen executives ousted 

After a string of lawsuits, complaints, and inches away from an angry mob with fiery pitchforks on MedMen’s doorstep: the founders were finally ousted from the company completely in 2020. 

In November 2018, a lawsuit was filed against the company by two previous employees. The suit said MedMen had violated labor laws. The suit claimed:

• MedMen failed to pay at least minimum wage for work performed off the clock
• The company didn’t pay for all hours worked, including overtime
• Accurate records of hours worked by the employees weren’t kept by the company
• MedMen didn’t provide adequate rest and lunch breaks to employees, as required by California law

A nearly $1 million class action settlement was reached in 2021 for this case. And in January 2019, two investors sued MedMen for alleged breaches of fiduciary duty. 

Eventually, the investors voluntarily dropped the suit in June 2019. But not without MedMen ultimately calling the lawsuit “frivolous”, “meritless”, and “egregious”. 

MedMen was also sued in early 2019 by the company’s ex-Chief Financial Officer, James Parker. 

This is the lawsuit where a lot of wild financial allegations were made.

 Bierman, in particular, was called out for using company money to pay for various expenses, including:

• 24-hour armed guards for founders and their families
• Private jets
• Cadillac Escalades and Teslas
• $300,000 therapist on staff, who was actually Bierman’s personal marriage counselor 
• Massage therapists

Of course – Bierman denied these allegations and MedMen actually won this case, but their reputation is so tarnished that this win is quickly forgotten. 

Whether the personal spending allegations were true or not, there’s no doubt the company liked to spend money.

MedMen invested heavily in tech and built a point-of-sale system. 

One executive employee who felt this waste of resources told Politico, “They would ask themselves at times, ‘Are we a marijuana company or a tech company?” 

MedMen’s drama continues 

Unlike other executive shuffles, Bierman and Modlin weren’t simply removed from their positions as CEO and President and placed as an advisor or board member. 

The twins of terror also gave up their board seats and all voting rights. The company they founded was ripped out from under them because they are walking, talking disasters. 

But, that doesn’t mean MedMen as a company went anywhere. 

Since their departure, the company has seen a handful of executives come and go as they attempt to restructure and revamp the business. 

MedMen is still struggling to maintain a profit, even after Modlin and Bierman left. 

Last March, the company was estimated to be burning through $25 million per quarter. In April 2021, Canadian producer Tilray acquired a majority stake in the company.

The lawsuits have slowed since the founders were ousted, but they haven’t stopped.

The most recent is Ascend’s suit against MedMen, claiming MedMen “materially breached” the deal to sell an 86.7% stake in MedMen’s New York operation. 

Ascend won this suit earlier this year and will purchase the New York operation for a revised total of $88 million – $15 million more than the original deal. 

Bierman and Modlin are even still getting caught up in lawsuits themselves, filing three lawsuits against the co-owners of Coastal Holdings Co., the company they joined under the radar last year. 

Bierman and Modlin eventually dropped the suits.

Skip forward to the present day. 

A whole new team of executives, horrible press, dwindling fans of the MedMen brand – and MedMen is still foolish. 

The company says their $1 million in unpaid rent is – WAIT FOR IT – unjustified because cannabis is federally illegal and the leasing company should’ve never agreed to rent to them.

Listen up, you unhinged cannabis company who does things that make me wonder if we really are on The Truman Show:  

I’m sure we’d all like to just absolve our responsibilities and not pay rent or our bills because of federal prohibition. 

But that isn’t how it works and MedMen knows that. 

They don’t want to pay the back rent, because they’re sad and broke, so they’re grasping at straws and hoping the court bites and dismisses their obligation to pay. 

“It is unlawful under Federal law to lease any place for the purpose of distributing any controlled substance, including marijuana, as Plaintiff did here,” MedMen writes in its latest memo. While the Lease and Guaranties that contemplate the operation of a cannabis dispensary may be legal under Illinois law, it is respectfully submitted that they are not legal under Federal law and cannot be enforced in this Court.”

I do not anticipate the court will agree with MedMen’s reasoning, but I also didn’t think we’d be sitting in 2022 with people still in jail for cannabis – SO like always: let’s see what happens.