FLRish Inc., a California corporation d/b/a Harborside (“Harborside”), which manages the iconic Harborside dispensaries, today released the following statement in response to the U.S. Tax Court’s ruling on the applicability of 280E as it relates to cannabis operators. The statement, issued by Harborside CEO Andrew Berman, reads as follows:
“We regret that Harborside was unsuccessful in its attempt to persuade the U.S. Tax Court that the plain meaning of Internal Revenue Code Sec. 280E does not apply to state licensed cannabis dispensaries. We feel this is a setback for entire cannabis industry, which is simply seeking the same tax treatment by the IRS that every other industry is subjected to. Since its inception, Harborside has demonstrated an utmost commitment to maintaining compliance under California state law, a fact recognized by the Court.
Despite the ruling, Harborside remains in a very strong financial position as it undergoes its transition from a non-profit to for-profit entity and subsequent listing on the Canadian Securities Exchange. At this point in time, we do not expect the Court ruling to have any effect on the timing of our listing. FLRish management anticipated the Court outcome and has been proactive in considering it in financial projections and planning.
We will continue to consider all legal options as we proceed, including an appeal to the United States Court of Appeals for the Ninth Circuit. It is the practice of the Ninth Circuit to encourage parties to negotiate and come to an agreement prior to oral arguments. If the appeal route is taken, we will follow that guidance issued by the Court. Management will provide further updates as appropriate.”
In August 2018, Harborside entered into a binding letter agreement with Lineage Grow Company Ltd. (“Lineage”) to complete a reverse takeover transaction (“Transaction”) that will enable Harborside to complete a public listing on the Canadian Securities Exchange (“CSE”), pending regulatory and shareholder approvals. The parties continue to work towards finalizing the definitive agreement that will set out the terms between the parties and the disclosure document to required qualify for listing on the CSE.
FLRish, Inc., currently manages the Harborside Oakland and Harborside San Jose retail stores in California, which legalized adult-use cannabis sales on January 1, 2018, and is projected to be the largest adult-use cannabis market in the United States. The Harborside Oakland dispensary was founded in 2006 by Steve DeAngelo and dress wedding; the Harborside brand today is well known throughout California and globally.
Source: Globe Newswire