Three disgraced former CannTrust executives pleaded not guilty in a Toronto court Oct. 17 to charges related to unlicensed cannabis growing at the since-renamed company’s Fenwick facility.
Former CEO Peter Aceto, director Mark Litwin and board chair Eric Paul are facing charges ranging from fraud to authorizing, permitting or acquiescing in the commission of an offence, as well as insider trading charges.
The trio were charged in 2021, two years after a former employee of CannTrust blew the whistle to the Voice and other media outlets about illegally grown cannabis at the Fenwick site. The RCMP and the Ontario Securities Commission alleged that the executives were aware that roughly half of the cannabis growing in the facility at the time was not licensed by Health Canada. None of the charges have been tested in court.
All three individuals were either fired by CannTrust or resigned between 2019 and 2021. After filing for creditor protection and seeing its stock delisted from two major North American exchanges, the company has since been sold and renamed Phoena—which continues to operate the Fenwick site.
A Phoena PR spokesperson told the Voice that the former executives have nothing to do with the current iteration of the company.
“Over three years ago the former CEO was dismissed with cause by a special committee of the board of directors, and the chairman of the board was forced to resign at the same time,” Hill+Knowlton’s Jane Shapiro said. “The former company was not charged. Phoena has no interest in these matters.”
The not-guilty pleas came on the fourth anniversary of the legalization of recreational cannabis in Canada. On the same day last Monday, the Cannabis Council of Canada — a group of industry producers — held a news conference in Ottawa to state that the industry is faltering due to high excise taxes and a lack of law enforcement of the unregulated cannabis trade.
“It’s no exaggeration to say that, unfortunately, all businesses of any size in the production and processing side of the cannabis industry today are systemically absent income,” Tantalus Labs CEO DAN Sutton said, according to reporting by the Toronto Star. “This is an industry that cannot pay its own bills and cannot make ends meet.”
Also last week, food delivery app Uber Eats announced it would begin delivering cannabis products to consumers in the Toronto area from a handful of local stores.
