High Times Holding Corp., which entered receivership in May, 2024, is now being sued by investors who want their money back.
A class action lawsuit was filed on June 27 in Delaware against the long-running cannabis publication by two former investors, Mark and Jill Donius.
The lawsuit claims the company mishandled investors’ funds. Specifically, it alleges that High Times failed to properly manage the $5,500 investment made by the Doniuses
The couple sent the money to Prime Trust, which was meant to act as an escrow agent, expecting it to be transferred to Equiniti Trust Company to manage their shares.
According to Green Market Report, which first reported on the lawsuit, the Doniuses received correspondence from High Times in March 2023, stating that their investment had been cancelled, and their money would be refunded.
However, the pair allege that no refund was ever received.
Although High Times argued at the time that the blame lay with Prime Trust, the lawsuit is taking aim squarely at High Times.
Prime Trust, typically a digital assets custodian, received a cease-and-desist order in June 2023 from Nevada’s Financial Institutions Division for failing to safeguard customer assets. Shortly thereafter, Prime Trust filed for bankruptcy, citing no accounting of High Times investor funds in escrow.
The lawsuit, which includes at least 40 investors, claims High Times failed to provide proper instructions to Prime Trust. Another investor, who bought shares in 2020, reported similar issues with V Stock Transfer and alleged bad faith from High Times.
It comes just weeks after the 50-year-old publication put its assets up for sale as it scrambled to raise funds to pay its creditors.
Greenlife Business Group, which is handled the sale, called for offers ahead of May 17, by which time any assets without bids will be put up for auction.
The property on offer included the intellectual property, including branding, domain name, and URLs for its flagship High Times magazine, Dope Magazine, Culture Magazine, alongside its famous Cannabis Cup and Chalice Cup events brands.
