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Investors in a failed Portland CBD startup have settled an acrimonious legal dispute with the company’s founders and former executives, new court filings indicate. They traded accusations of cheating one another in a succession of business deals linked to Oregon’s marijuana industry.
The legal fight pitted Boris Jordan, a wealthy Florida investor with ties to Russian oligarchs, against scandal-plagued Portland marijuana entrepreneur Nitin Khanna. The parties haven’t disclosed terms of their settlement, but it appears to wrap up a saga that dates back more than a decade.
Attorneys for Jordan, Khanna and other parties to the litigation did not respond to requests for comment about their settlement.
Last year, Jordan accused Khanna and associates of making false claims about their Portland CBD business, Sentia Wellness, to attract investment. Jordan accused Khanna and others connected to Sentia of a $60 million securities fraud.
Khanna fired back with a $516 million counterclaim, accusing Jordan of improperly pressuring him to sell Khanna’s marijuana business, Cura Cannabis, at a sharply discounted price. Cura spun off its CBD business into Sentia after that deal closed, with financial backing from Jordan.
The companies
Curaleaf: Based in Massachusetts, Curaleaf is among the nation’s largest marijuana companies. It acquired Portland-based Cura Cannabis in 2020 in an all-stock deal valued at $400 million when it closed.
Cura Cannabis: Portland-based marijuana company that emerged from Iris Capital, a Lake Oswego real estate scam. Nitin Khanna served as CEO until 2018 and remained chairman until Cura’s sale to Curaleaf in 2020. Curaleaf’s chairman and founder is Boris Jordan, an American billionaire who helped privatize state-run industries after the Soviet Union’s collapse.
Sentia Wellness: Portland CBD company spun out of Cura Cannabis raised $91 million ahead of its 2019 launch but collapsed almost immediately, blaming changing regulatory conditions and the COVID-19 pandemic. It sold its Social CBD brand in 2021. Khanna was Sentia’s CEO and Jordan was among Sentia’s financial backers.
Cura had emerged several years earlier from the notorious real estate scam. Iris Capital, which collected investments from retirees ostensibly to invest in real estate, instead diverted the money into the marijuana business that became Cura. The retirees lost $1 million in the deal. Khanna denied any role in the fraud, saying he joined Cura afterward.
Portland-based Cura sold to Jordan’s similarly named but previously unrelated company, Curaleaf, in 2020. The all-stock deal was initially valued at $1 billion, but the transaction was ultimately worth around $400 million when it closed in 2020. That’s because Curaleaf’s stock price had dropped and because Curaleaf had demanded better terms after Cura suffered a string of business setbacks.
After Cura’s sale, Khanna — with financial backing from Jordan — created Sentia in 2019 to sell CBD wellness products. CBD is cannabidiol, which doesn’t have the psychoactive properties associated with marijuana. Adherents believe it has a variety of health benefits.
Sentia raised $91 million for its launch but collapsed almost immediately, beset by manufacturing problems and federal restrictions on how it could market its wellness products. That triggered Jordan’s suit last year. He accused Khanna and other Sentia executives with misleading about the Portland company’s business prospects.
In response, Khanna’s claim alleged Jordan had improperly used his position as an investor in Curaleaf, Cura and Sentia to force Cura’s investors to accept a severely discounted price when they sold the business to Curaleaf.
A notice of settlement filed in Multnomah County Circuit Court last week indicates the parties “have reached an agreement to resolve all claims, counterclaims, defenses, and disputes between and among them asserted in this action.” Formal dismissal of their claims awaited completion of unspecified obligations from the deal.
The settlement appears to be the last significant piece of outstanding activity related to the companies.
Last month, Portland attorney Nick Slinde, who represented Iris and Khanna, and who also held a large stake in Cura, accepted a reprimand from the Oregon State Bar for engaging in misconduct by failing to disclose conflicts of interest in the matter.
— Mike Rogoway | mrogoway@oregonian.com |
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