Let the feeding frenzy begin. Mockingbird Cannabis accused its former CAO and CFO of looting over $8 million from the company in a lawsuit filed in Hinds County Circuit Court Friday.
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| Credit: Mockingbird Facebook page |
Mockingbird rolled into Mississippi a few years ago as the medical marijuana industry became a reality in Mississippi. Company officials talked big about hiring Mississippi employees and recruiting a stable of Mississippi investors. An Oklahoma crew of Clint Patterson, Warren Bunch, Charles Wilkin and Jackson attorney Marcy Croft formed Mockingbird Cannabis, LLC in 2020 and Mockingbird Holdings in January 2021. Mockingbird has been plagued with financial problems for quite some time as the medical marijuana industry struggled in Mississippi .
Wilkin was one of Mockingbird's founders and its first Chief Administrative Officer. He also served as Chairman of the Company's Board of Managers . He controls the Wilkin Family Trust, another defendant. Warren Bunch was the company's first Chief Financial Officer. He controls co-defendant Tempe Holdings, LLC.
The complaint alleges:
Wilkin and Bunch prepared and distributed financial forecasts to insiders and investors which were not even remotely reasonable or realistic. As an experienced financial advisor, Bunch knew, or should have known, the forecasts contained material errors or omissions which can only be reasonably explained as intentional and fraudulent in order to justify the redemption and sale of $8 .33 million in non-capital units that benefitted him directly. As a lawyer and experienced cannabis company operator, Wilkin knew, or should have known, the financial forecasts were fraudulent. 18. The aforementioned financial forecasts were foundational to the fraudulent and improper redemption and sale of $8.3 million of non-capital Founder units from which Wilkin and Bunch personally profited.
The defendants stand accused of using the company as a "transfer agent" to line their pockets. They allegedly sold and converted shares when the company "had no operating income and was in desperate need of capital to fund operations."
What does it all mean?
While the Company has struggled financially, consistently operated at a deficit and been unable to provide a return on investment to its investors, Bunch personally profited a total of $1 million while serving as the Company's CFO and another $1.33 million very shortly after he was CFO. Wilkin personally profited $2 million. These amounts were not executive compensation; Wilkin and Bunch each received regular compensation for their services as officers.The complaint charges the defendants with beach of fiduciary duty, fraud, fraudulent concealment, and civil conspiracy. The plaintiffs seek equitable relief and punitive damages as well.
The lawsuit may be all for naught as the complaint admits there is an arbitration clause in the operating agreement. The plaintiffs state they filed the lawsuit to protect their claims in Mississippi if the statute of limitations expires.
The case is assigned to Hinds County Circuit Judge Winston Kidd.
Mockingbird is facing other legal problems. A group of investors sued the company last year, alleging company officials looted the company for tens of millions of dollars and treating company finances as a personal slush fund. Earlier post.
The lawsuit was filed in Hinds County Circuit Court. A defendant filed an interlocutory appeal with the Mississippi Supreme Court, alleging an arbitration clause and an improper transfer from Circuit Judge Debra Gibbs to Special Circuit Judge Barry Ford .
It is not known if Dwight Manfredi is a Mockingbird investor.
17 comments:
You are going to get a lot of liver stained hands ranting about "medicine" but this issue is because "weed stocks" became more profitable than cannabis. Such is the case with a lot of speculative investments. These grifters forget that they have to at least pretend to be running a business to keep the investors from getting spooked to your rug-pull.
What were these investors smoking when they bought into this scam?
More reefer madness.
"It is not known if Dwight Manfredi is a Mockingbird investor. "
Neither of those names is mentioned in what you typed. I am not reading 11 pages of outside attachments.
This is such an embarrassment. Are Mississippians not sick of getting shafted? How does this always happen? The incompetence and inevitable white-collar theft. Fitch's dumb ass asleep at the wheel. Who benefits from the way anything in MS is run? The MS ruling class has sucked for a century. We're coming up on centuries of consistent sucking. Centuries - plural! It's clear the experiment has failed, and the "wise men" of the state should be put to better use in a field somewhere. The current "meritocracy" has failed. Where should we even begin?
You like bud and I like flower
You smoke flower and I toke bud
Toke, smoke, bud, flower
Oh, let's call the whole thing dope
I've preached it before here. I'll preach it again: Nothing good comes from weed, not ever.
I've wondered why, for months now, there are only a couple of cars in the large parking lot alongside the Mockingbird facility on Springridge Road in Clinton (or Raymond, depending on whichever news article you read). It doesn't appear to have been much activity there for quite awhile. But maybe pot growing isn't labor intensive? Are they still producing any product for such a huge investment?
They are producing law suits
@1:10 Not even the US Constitution?
1:35, its a plant. You plant it and watch it grow. Doesn't take much labor for that. Its grown in water, so you don't even need a plow.
@11:52 😆😆 Yogi Berra said, “ You can see a lot when you look around.”
11:13, What the hell are you trying to say?
@1213 - why the hell is this an embarrassement for the State? This is well an embarrassment for the fools that got duped and believed the cons that talked them out of their money, but as the old saying goes, a fool and his money are soon parted.
There were/are probably some good investments to be made in the weed business, just as there are some good (and bad) in most every business; too many bet their asses on the hope that the so-called medical crap would soon be gone and this turned into recreational, as some of the 'leaders' in the MS Senate hoped as they wrote the legislation allowing this pot to simmer.
As my ol' grandad used to teach, one should do your background investigation before signing the check; and that applies more and more when dealing with unknown promoters of a business one is not personally knowledgeable of; which it appears many of those now suing fit that bill.
And, BTW, it ain't none of Lynn Fitch's business what these private investors were doing amongst and between themselves; not that if it were the Lady in Red would have done anything about it , but regardless her focus shouldn't be to arbitrate between crooks and dupes. Besides, she's too busy trying to find a landing spot in DC where she doesn't have to work; done all of that she can get away with here in Jackson.
Can't a fella shake his fists at The Powers That Be without you talking all this parasite-apologetics malarkey?
... too many bet their asses on the hope that the so-called medical crap would soon be gone and this turned into recreational ...
The exact story Bomgar's signature gatherers told students on our college campuses up and down the state. FACT.
This is shocking! I can’t believe anyone in the weed business would be accused of trying to scam someone else, much less actually scamming someone else.
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