(Note: This story was updated March 22 to clarify the lawsuit and that Vincent Mehdizadeh no longer is with Pineapple Express.)
Pineapple Express, which provides consulting, financial and real estate services to marijuana businesses, has been named in a lawsuit filed by three companies that allege the Los Angeles firm owes them nearly $685,000.
Pineapple Express CEO Matthew Feinstein stressed in an email to Marijuana Business Daily that a subsidiary the company has since sold is the target of the lawsuit, not Pineapple Express.
The Desert Sun reported that the plaintiffs – MSA Consulting, Orr Builders and Prest-Vuksic Architects – charge that “Pineapple Express and its subsidiaries” failed to pay for their work designing and building Pineapple Park, a 10-acre cultivation complex in Southern California.
Pineapple Express said the debt stemmed from a bad real estate deal, The Desert Sun reported.
The suit is the latest financial issue involving publicly traded Pineapple Express.
The company announced March 3 that it had eliminated its chief compliance officer position and replaced its chief financial officer post with a public accounting and compliance firm. The cuts will save $30,000 a month, Pineapple Express said.
In April 2016, the Securities and Exchange Commission temporarily halted trading in Pineapple Express stock because of “unusual and unexplained” market activity and concerns over the firm’s trading practices.
Pineapple Express co-founder Vincent Mehdizadeh, who left the company in March 2016, was recently charged by the SEC for issuing bogus reports about another business he founded, Medbox, and creating a shell company for conducting “sham transactions.”