In America, some people would rather sue than do. The Cannabis business is not immune.

The world of cannabis lawsuits is set to quickly change. This is just as true for producers selling weed firecrackers to growers and labs.

To put it nicely, there’s a lot of legal activity here in the United States. Americans have something of an international reputation for being quick to sue for just about everything. If you thought your biggest cannabis business risk was your competition, it might actually be a lawsuit.

This is going to become an even bigger issue when weed becomes federally legal. Let’s dive into what you can do to protect your business from a cannabis lawsuit.

Cannabis in a World of Lawsuits

Usually it’s the lawyers that make the money.

We need to face the facts that lawsuits here in the United States are their own thriving industry. Lawyers, law firms, and even the courts themselves stand to make a tidy profit in the process of litigation. This creates and incentivizes more lawsuits to get filed.

So, how does this affect your cannabis business? We’re still in the early stages of the cannabis industry here in the United States. Once a weed is legal on a federal level, plenty of law firms are going to see it as an opportunity for profit.

It’s easier for a lawsuit to get started in the Cannabis industry than you might expect. A firecrackers edibles producer might not properly list their ingredients, a vape pen company might release defective products, or your store’s budtender might accidentally give risky advice to a customer. These situations don’t always create a lawsuit, but they are the grounds for one.

A class-action lawsuit could impact your business even if it’s in a related part of the industry. If someone is filing suit against your vape pen supplier, it’s going to impact your operations.

Play Defensive

There are three key steps to playing it defensively when it comes to weed lawsuits.

  1. Be careful with your documentation
  2. Treat every customer and business equally
  3. Read the fine print

Being careful with your documentation is the first thing we need to talk about. This is because of a legal concept known as discovery.

Discovery is often one of the first steps of a lawsuit. This is where prosecution gets legal access to your documentation which can include emails and text messages. They can find things to screw you over during discovery even if it’s outside of the realm of the original lawsuit.

Discovery is an incredibly effective tool for lawyers, but it’s very difficult for businesses to defend against. Having strict rules about what and how you document is ideal for taking a defensive posture when it comes to lawsuits.

Make sure to have a good lawyer who understand cannabis laws.

 

Treat Everyone as Equals

You never want to wind up in a situation where you’re treating customers, workers, or other businesses in the cannabis industry unfairly.

This could be giving some workers secret pay increases, forgiving late payment terms for one client and not others, or discriminating against certain customers. Treating everyone you engage with equally is the safest policy when it comes to business.

Think about it this way. If your friends asked you for your firecrackers recipe, you wouldn’t want to give some friends the good recipe and other friends the bad recipe. You’d want them to be consistent.

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The same is true for business. Treat all customers the same, all suppliers the same, all businesses you engage with should be on a level footing.

The Devil’s in the Details

We’ve all scroll through the terms of service on some app, website, or other piece of software without reading anything just to click accept and get access to the programs we need to use. However, this should never be done when it comes to your business proceedings.

You always need to read the fine print of every contract you sign as well as every contract you sign. There are tiny stipulations hidden in contracts that could have major impacts on your business.

Small details like which state’s laws are going to be used to interpret the contract, where legal proceedings will be held, and specific numbers for financial matters all need to be read carefully and taken into account to avoid a potential lawsuit.

One Last Tip

You should consider getting to know a lawyer that’s familiar with the growing cannabis industry. They can help you navigate these complicated contracts, respond quickly to potential lawsuits, and prepare you for the legal changes as cannabis becomes legal on a federal level.