The San Francisco-area rapper who based Cookies is being accused of utilizing strong-arm and bullying ways to run the favored hashish model, and forcing different corporations to pay him and high executives thousands and thousands of {dollars} in kickbacks to do enterprise.
Those that refuse to pay up, in line with a pair of lawsuits filed in Los Angeles County courtroom, face threats of bodily violence or “slanderous blasts on social media,” in addition to the shortcoming to do enterprise with Cookies, which has sprung up greater than 30 shops throughout the U.S.
“Defendants’ pervasive wrongdoing has triggered their very own pockets to be lined whereas inflicting large losses to Cookies and its shareholders,” legal professionals for a bunch of buyers allege in a lawsuit filed Feb. 8.
In a single instance, Berner, whose actual identify is Gilbert Milam Jr., took diamond jewellery valued at greater than $1 million as a kickback from a 3rd celebration to ensure that the corporate to do enterprise with Cookies, in line with the lawsuit.
Milam has denied the allegations and mentioned in an Instagram publish addressing the lawsuits {that a} group of “predatory buyers” have been trying to take away him and different high management from Cookies, which has rapidly grown to a half-billion-dollar firm, in line with Forbes.
“These guys have made extraordinarily false, damaging claims about myself which are utterly simply unfaithful, and I actually look ahead to the day in courtroom that we will show that these claims are false,” Milam mentioned within the video. “They’re making an attempt to take away me [and] present management from Cookies.”
Hassle for the model started in January when Cookies Retail Merchandise, or CRP, sued Milam’s firm over a 2021 settlement for CRP to promote Cookies-branded merchandise containing CBD, a non-psychoactive compound in hashish.
In accordance with the lawsuit, Cookies instructed CRP to make use of its suppliers and associates to get the merchandise in the marketplace quicker. CRP alleged it was “shoehorned” into utilizing Cookies’ suppliers and pressured by executives to repeatedly enhance the variety of orders regardless of manufacturing delays, defects and different issues.
After investing thousands and thousands of {dollars} within the deal, CRP realized executives at Cookies “had been gathering ‘kickbacks’ and different extra ‘charges’ that have been handed via as inflated prices to CRP,” in line with the lawsuit.
“[Cookies] staff didn’t wish to lose their kickbacks by operation of CRP utilizing various suppliers,” the lawsuit claims.
In accordance with the lawsuit, CRP was instructed the staff getting kickbacks had been fired, however Cookies nonetheless prohibited CRP from altering suppliers. The corporate additionally alleges that the excessive prices to fabricate by no means modified and that kickbacks remained, regardless of assurances from Cookies.
Cookies executives additionally delayed the discharge of vape cartridges, blunts, vaporizers, gummies and different merchandise, making them spoil, CRP alleged.
The Feb. 8 lawsuit repeated allegations that executives have been receiving kickbacks for offers, together with diamond jewellery, housing and money that Milam allegedly accepted to fund a “lavish way of life,” even when the offers weren’t worthwhile for the corporate.
Traders additionally alleged Milam used firm sources for private causes, similar to utilizing Cookies sources to advertise his music profession and utilizing the corporate’s bus for private journey.
Cookies President Parker Berling additionally used firm sources for different ventures and promised contracts with Cookies in change for investments in his different corporations, the lawsuit alleges.
“Typically, third events that refused have been threatened,” the swimsuit says. “In some cases, Defendants even threatened to, or did, trigger property and bodily harm.”
The lawsuits didn’t present particular examples of bodily threats made by high executives however alleged the threats have been used to steal hashish strains and different mental property from third-party corporations.
Traders requested Cookies to launch an investigation, together with into full disclosures of economic pursuits of high executives similar to Milam and Berling, however no investigation has been launched to this point, in line with the swimsuit.
The lawsuit alleges breach of fiduciary responsibility.
Officers at Cookies didn’t instantly reply to a request for remark.
In his Instagram video, Milam mentioned the buyers are utilizing the lawsuits as a method to take management of his firm. The rapper alleged they tried to take benefit final yr, when he was being handled for stage 3 colon most cancers.
“I used to be actually preventing for my life,” Milam mentioned within the video. “What made that combat much more troublesome and difficult was the truth that I used to be pressured to combat for my enterprise on the identical time.”
Milam didn’t deal with allegations of kickbacks within the video however mentioned he deliberate to combat the lawsuits in courtroom.
“These guys are throwing a match and making an attempt to place me and my firm in a nook and starve us out,” he mentioned. “Nicely, that’s not going to occur.”
