Legal & Regulation
Hemp CBD Companies ADM Labs and Colorado Cultivars Caught Up in Lawsuit
In a recent report by Westworld, two hemp companies based in Colorado are engaged in litigation over 8,300 pounds of CBD crude oil, which is hemp concentrate that has not yet been refined. The report is based on documents obtained by the publication. The report also indicates that the crude oil is estimated to have a value of $7.56 million.
In the lawsuit, filed in Denver District Court, ADM Labs is suing Colorado Cultivators. ADM alleges that Colorado Cultivators is not abiding by the companies’ extraction agreement. Per the agreement, ADM labs would supply Colorado Cultivators with hemp biomass for extraction. ADM labs would receive 65 percent of the yield, and Colorado Cultivators, the rest. The suit alleges, in part,
“Problems developed shortly after ADM began sending Cultivars hemp biomass in October 2018. In particular, Cultivars failed to timely process the hemp biomass, timely deliver crude oil to ADM, and provide ADM with supporting documentation for processed biomass. As a result, Cultivars began to cause ADM significant downstream delays that severely affected ADM'S business and its customers.”