Judge approves $500,000 settlement by Nipomo pot businesses

Cameras and chain-link fences topped with barbed wire strands protect the CFAM facility on Mesa Road.

Correction: San Luis Obispo County Superior Court Judge Ginger Garrett signed an order giving the court jurisdiction to enforce a $500,000 settlement and the destruction of cannabis. Garrett did not rule on the state’s allegations.

By CCN STAFF

A San Luis Obispo County Superior Court judge approved a settlement last month, in which two Nipomo marijuana businesses agreed to pay more than $500,000 to resolve civil penalties, legal fees, and investigation and destruction of cannabis costs to the state.

On March 13, 2019, state investigators raided a warehouse complex at 887 Mesa Road, the former Clearwater Nursery. CFAM and Lowell Herb were operating out of the warehouse, according to a California Department of Fish and Game incident report. While CFAM had a license to process and store cannabis on the property, it was illegally subletting to unlicensed cannabis businesses.

During the raid, regulators seized 1,387 pounds of loose flower buds, 7,162 jars of flower buds, 17,600 pre-rolls (marijuana cigarettes), 125 pounds of cannabis kief and 60 pounds of cannabis shake.

Judge Ginger Garrett approved the settlement agreement in which the defendants — Brett Myers Vapnek, David Elias, Lowell Farms, and The Hacienda Company — agreed to pay $500,000 to resolve the civil penalties, and $46,413 for attorney fees and the cost of the investigation and destruction of the illegal cannabis products.

During the raid, Vapnek admitted he had been operating without a license from Dec. 2018 through March 13, 2019, according to court records. Vapnek also runs Nipomo Ag, a cannabis cultivation company.

Even though the defendants agreed to pay $500,000 to resolve the state’s civil penalties, they did not admit to the allegations.

“By engaging in unlicensed commercial cannabis activity, defendants placed unregulated cannabis into the cannabis market, thereby causing economic harm to California’s legal commercial cannabis industry and supporting the illegal cannabis market,” according to the state. “Defendants’ distribution and sale of illegal products that are potentially untested … create grave public health and safety risks to Californians.

“Moreover, by engaging in unlicensed commercial cannabis activity, defendants deprived the CDFA of licensing fees and tax revenue.”

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