CBD product manufacturer and franchiser SunFlora has been accused of deceptive trade practices by several business partners in Pennsylvania, according to a new lawsuit filed against the company in federal court.
The suit, filed Friday by Joseph Gradwell, Christopher Miller, Greg Muiter and Melanie Vaughan, alleges that the Florida-based company tricked them in 2019 into signing documents that made them “affiliates” instead of “franchisees,” in violation of both state and federal law.
Law360 reported that the quartet all agreed to run Your CBD Stores – a national chain franchised by SunFlora – in western Pennsylvania, but weren’t told that they’d be charged over-wholesale market prices for SunFlora-made products, which the plaintiffs alleged erased their profit margins.
The suit further alleges that SunFlora retaliated when the plaintiffs considered selling other branded products, and that the company threatened to terminate their franchise agreements.
The suit requests unspecified damages and a court order declaring the franchise agreements unlawful and unenforceable.