California hemp producer sues Santa Cruz County for incorrect hemp sampling, leading to crop loss

Sungrown Organic Hemp, a hemp producer in California, says the county owes it $9.6 million for incorrectly sampling its 2019 hemp crop, which led to a false determination that the crop was marijuana.

The Watsonville farm filed the lawsuit on Tuesday in county court, claiming that the Santa Cruz County Department of Agriculture used faulty sampling that delayed the producer in harvesting the 15-acre crop until the issue was cleared up. By then 90% of the flower was spoiled due to moisture, according to the lawsuit.

After harvesting, Sungrown Organic Hemp recouped $300,000 of its $620,000 in costs, resulting in a net loss of $9.6 million.

Damages were calculated using the January 2020 Hemp Benchmarks Index, determining that the farm’s organic certification and biodynamic cultivation protocols would have yielded $675 per pound of hemp.

Sungrown Organic Hemp tested regularly throughout the season, with all tests showing a THC percentage below the 0.3% legal limit, according to the lawsuit, which included the producer’s certificate of analysis.

Tests from the county’s initial sampling resulted in a 0.44% THC concentration.

According to Jordan Levy, principal of Sungrown Organic Hemp, the county agriculture commissioner and another agent did the sampling incorrectly according to the state’s then-current regulations, defining sublateral branches as lateral branches, and taking less of the total plant and more of the concentrated tops of the plants than the protocol specified.

When the county tested 10 days later, county agents did the sampling correctly, according to Levy, and a county agent admitted that she took sublateral branches in the first test. The second test yielded a 0.3% THC concentration.

Levy claims that it is possible that other farmers in Santa Cruz County had false positives that season and destroyed their crops.

A trial date was not indicated.