Jay-Z's Cannabis brand accused of illegal activity
Jay-Z’s Monogram cannabis brand illegally shipped pot from California to New York, filed inaccurate financial reports and engaged in gender discrimination, a new lawsuit alleges.
Cathi Clay, a former vice president at The Parent Company (TPCO), a San Jose cannabis company that produces the Monogram brand, made the explosive allegations in a lawsuit last month. Clay alleges that TPCO executives harassed and discriminated against her because of her gender and then retaliated after she filed a whistleblower report regarding financial inaccuracies and violations of state cannabis regulations.
TPCO manufactures cannabis products, owns 11 retail cannabis locations in California and employs more than 650 people, according to Securities and Exchange Commission financial reports. The company produces multiple cannabis brands, including Monogram, the official cannabis brand for the musician Jay-Z and his Roc Nation record label. Shawn Carter, Jay-Z’s legal name, serves as the chief visionary officer for TPCO, according to an SEC filing. Monogram has worked with major recording artists, including Jadakiss, 2 Chainz and Curren$y.
TPCO told SFGATE the lawsuit's allegations are “false.”
“The company does not comment on active litigation and plans to defend itself strongly against the false accusations,” a spokesperson wrote in an email.
Roc Nation did not respond to multiple SFGATE requests for comment. A representative for Shawn Carter could not be reached.
David S. Ratner, an attorney for Clay, declined to provide SFGATE with documented evidence of the lawsuit’s claims.
“We are not comfortable sharing evidence at the early stage of this litigation. Let it suffice to say that we have concrete irrefutable proof of each allegation in the Complaint,” Ratner wrote in an email.
Clay’s lawsuit claims that she experienced years of harassment from the company’s executives, including Chief Financial Officer Mike Batesole. During her time at the company, Batesole acted “aggressive, demeaning, and publicly questioned Ms. Clay's abilities” and told Clay that she was being treated differently because she “used to ‘be nicer,’” according to the lawsuit. Clay also claims that Batesole “made many inappropriate comments about women, hiring ‘housewives’ to perform accounts payable, people of color and skill sets of employees.”
The lawsuit claims that Clay’s treatment worsened after she warned executives at the company that financial filings with the SEC in 2021 and 2022 contained “outright inaccuracies in the financial records.” TPCO is a publicly traded company on a Canadian stock exchange.
Clay also claims in the lawsuit that executives at the company were shipping cannabis products across state lines “to New York for a Monogram event with Shawn Carter.” Moving cannabis across state lines is a felony at the federal level, and California’s cannabis regulations strictly prohibit shipping legal cannabis out of state.
Clay filed a whistleblower report to the company in August of last year and resigned the following day, according to the lawsuit. She claims that she was “harassed and discriminated against” for reporting the financial and legal violations and was ultimately forced to resign from the company.
The lawsuit was filed in Santa Clara County Superior Court on Feb. 16. TPCO has 30 days to respond to the lawsuit, according to a summons filed with the court. An initial court hearing has not yet been scheduled.