The cannabis industry is hurting right now, and most everyone is feeling it. As new and old clients consider pursuing breach of contract and other claims against cannabis businesses that are failing, one question seems to come up again and again: can we sue the owner(s) of the cannabis company personally for the company’s failures (failure to pay, failure to provide goods or services as promised, etc.)?
Unfortunately, the short answer generally is, no you cannot. Most states generally adhere to the principle of limited liability, which shields owners from personal liability for the company’s debts and obligations. That includes cannabis company owners.
Exceptions to the rule
However, there are specific circumstances under which you may be able to sue an owner of a cannabis company personally. These are exceptions and situations in which you might be able to pierce the corporate veil and hold owners personally liable:
Fraud and misrepresentation. If an owner of a cannabis company engages in fraudulent or deceptive conduct that causes harm to you or your business, you may be able to sue them personally for damages. This could include situations where the owner intentionally misrepresents information or conceals material facts to induce you into
Read full article on HarrisBricken
