Viridis Labs is now suing Michigan CRA officials

The Legal Battle Between Viridis Laboratories and the Michigan CRA

Introduction

The cannabis industry in Michigan is witnessing a high-stakes legal battle between Viridis Laboratories, LLC, and the Michigan Cannabis Regulatory Agency (CRA). The case, Viridis Laboratories, LLC et al v. Kluytman et al, centers around a 2021 recall of cannabis products tested by Viridis, raising significant questions about testing methodologies, regulatory fairness, and the future of cannabis safety compliance in the state.

Background

Viridis Laboratories, a prominent cannabis testing facility in Michigan, found itself at the center of controversy when the CRA issued a recall for products it had tested. The recall, prompted by alleged aspergillus mold contamination, affected thousands of cannabis products and had substantial financial implications, estimated at over $200 million​.

The People

The lawsuit Viridis Laboratories, LLC et al v. Kluytman et al involves several key officials from the Michigan Cannabis Regulatory Agency (CRA). Here are the names and positions of the defendants:

1. Julie Kluytman:
   • Position: Director of the Enforcement Division at the CRA.
   • Role: Julie Kluytman is responsible for overseeing regulatory compliance and enforcement actions within the agency.
2. Desmond Mitchell:
   • Position: Licensing Director at the CRA.
   • Role: Desmond Mitchell manages the licensing processes for cannabis businesses, ensuring they meet regulatory standards and requirements.
3. Allyson Chirio:
   • Position: Manager of the Operations Support Section at the CRA.
   • Role: Allyson Chirio oversees various operational aspects of the CRA, including laboratory support and compliance with testing procedures.
4. Claire Patterson:
   • Position: Director of Michigan’s new Cannabis Reference Laboratory and also serves as the workgroup chair for the CRA
   • Role: Claire Patterson provides guidance on quality control oversight and laboratory performance optimization for the cannabis industry

These officials are being sued in their individual capacities, and the lawsuit contends that their actions led to the unjust recall of Viridis Laboratories’ cannabis products, alleging flawed testing procedures and potential bias.

The Dispute

Viridis Laboratories’ Testing Procedures

Viridis Laboratories employs industry-standard testing procedures, including:

1. Microbiological Culturing: This involves placing cannabis samples on selective media to encourage mold growth and identify contaminants.
2. Quantitative PCR (Polymerase Chain Reaction): A sensitive technique that amplifies and quantifies DNA sequences specific to aspergillus mold, allowing for precise detection.

CRA’s Testing Procedures

The CRA conducted retests on Viridis-tested samples, using:

1. Enhanced Sensitivity Tests: Potentially more stringent thresholds or different media that are more likely to show contamination.
2. Alternative Analytical Techniques: Methods that Viridis claims are not industry-standard and improperly applied, leading to alleged false positives for mold contamination.

Viridis’ Claims

Viridis disputes the recall on several grounds:

1. Inconsistent Results: They argue that the CRA’s retests produced inconsistent results compared to their initial tests, which showed no significant mold contamination.
2. Flawed Methodology: Viridis claims that the CRA’s testing methods were flawed and not validated to the same scientific standards as their own procedures.
3. Lack of Comprehensive Testing: The laboratory points out that the CRA did not conduct enough tests to justify the recall, a point partially upheld by a judge who downsized the recall due to insufficient evidence​​.
4. Targeted Action: Viridis suggests that the CRA may have had ulterior motives, aiming to reduce their market share in the cannabis testing industry.

Legal Proceedings

The case has seen multiple legal battles across various courts, including state and federal levels. Viridis has provided detailed scientific evidence and expert testimonies to support their claims, emphasizing discrepancies in the CRA’s protocols and the potential for biased actions.

Implications

The outcome of this lawsuit could have far-reaching implications for the cannabis industry in Michigan:

1. Regulatory Practices: It raises questions about the reliability and fairness of current testing and regulatory practices.
2. Financial Impact: Both parties face substantial financial risks, with Viridis challenging the $200 million recall and the CRA defending its regulatory decisions.
3. Future of Testing: The case could lead to changes in how cannabis testing is conducted and regulated in Michigan, potentially prompting the state to establish its own testing facilities to ensure unbiased and standardized procedures​.

Conclusion

The legal battle between Viridis Laboratories and the Michigan CRA is more than just a dispute over testing procedures. It highlights critical issues in regulatory practices, industry standards, and the future of cannabis safety compliance. As the case unfolds, stakeholders in the cannabis industry and beyond will be watching closely to see how it shapes the landscape of cannabis regulation in Michigan.

References: Justia and WKAR​ (WKAR)​​ (Justia Dockets & Filings)​​ (Justia Law)​.