Sean Mack quoted in the Law360 article, “Class Action 'Avalanche' Coming For CBD Industry.” The article explains that class actions have been popping up against CBD companies in federal courts. Attorneys are explaining that this is the beginning of consumer litigation against cannabis businesses.
"Someone files one, and then it's, 'Jump on the bandwagon,'" said Sean Mack, co-chair of Pashman Stein Walder Hayden PC's litigation practice.
Compared to marijuana products, which are only legal in certain states and cannot be transported across state lines, CBD claims are more conducive to a class action, Mack of Pashman Stein said.
"Your class base, the number of consumers, is certainly much bigger, and has the potential to be nationwide," he said. "Each particular dispensary is only serving the population around it."
Letters like the ones the FDA sent to some CBD companies earlier this year got a lot of news coverage, which could inspire consumer class actions, Mack added. Curaleaf Inc. was one of the companies that received an FDA letter about its marketing, and it wasn't long before a few proposed classes of shareholders hit the company with lawsuits over the letter's impact on stock prices.
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