Rapper and cannabis entrepreneur Berner, the CEO of Cookies, issued an Instagram video response on Wednesday to lawsuits filed against him and several other Cookies executives, employees, and associates.
One such lawsuit, first covered by Alex Halperin for WeedWeek, was filed by Cookies investors BR Co. and NedCo in February; the suit claims that Berner and other defendants engaged in “pervasive self-dealing” leading to “millions of dollars in personal benefits and kickbacks,” among other allegations.
In the Instagram video, Berner — legal name Gilbert Milam — discussed the legal battle publicly for the first time, suggesting the plaintiffs are “predatory investors” who “saw a good opportunity to make a move on me and the leadership over at Cookies,” and who “made extremely false, harmful damaging claims about me [that are] completely not true.”
Berner also likened the lawsuits to a “loan-to-own” plot and thanked the brand’s fans and investors who still support him. “I’m looking forward to the day in court that we can prove that these claims are false,” he said. “They’re fucking bullshit.”
The lawsuit cites another California lawsuit against Cookies by Florida-based Cookies Retail Products (CRP), which claims to have an exclusive license agreement for national delta-8 THC product sales under the Cookies brand. That suit, filed in January for $38 million, accuses Cookies executives of pushing CRP to “use only suppliers that were affiliates of defendants…so that defendants could take kickbacks,” according to the report.
The BR Co. and NedCo lawsuit further alleges:
- Defendants have used Cookies resources to promote personal interests.
- Defendants insisted Cookies and its licensors use a specific construction company despite costing “more than double” because the company was owned by an executive’s brother.
- And defendants have attempted to negotiate with third parties by having employees tell them “that they needed to pay [defendants] kickbacks or give them other personal benefits in order to do business with Cookies…These tactics were used to steal cannabis strains and other intellectual property from third parties,” according to the report.
Ultimately, the plaintiffs demand that Berner and two other directors be removed from the company’s four-person board, and the lawsuit calls for an “order imposing a constructive trust on all funds or gains that defendants have and/or will otherwise unjustly obtain at the expense of Cookies.”
Update (5/1/23): Florida-based CRP said in an April 28 press release that it has “voluntarily dismissed all suits and claims, and expresses a sincere regret for any misunderstandings CRP’s allegations may have caused.”
“CRP is unaware of any unethical behavior by Berner, Berling, or Cookies’ Management,” the release says. “In fact, as a matter of record, CRP has never implicated or named Berner in any action nor made any claim that he has ever conducted himself in any manner other than professional, kind, and a leader in the space.”
Paul Rock, CEO of CRP, further clarified in a statement: “Certain third parties influenced us to file suit based upon allegations that we learned were not true, so we took immediate steps to rectify the mistake by dismissing the suit.”
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