Adam JacksonDocklight Brands Inc. filed a complaint against cannabis giant Tilray Inc., accusing the company of backing out of a deal to sell Bob Marley-branded cannabis products in Canada.
Docklight alleges that the move cost it licensing fees, royalties, and eventually the Bob Marley license itself, according to an amended complaint filed on May 31, Law 360 reported.
The dispute dates back to a licensing agreement in February 2018 between Docklight and Tilray subsidiary High Park Holdings to sell and market the products. The lawsuit claims that after Tilray merged with Aphria, High Park halted required quarterly payments.
High Park justified the delayed payments as a result of Tilray’s new management familiarizing themselves with the agreement. However, Docklight disputes this, arguing that Tilray’s executives had already reviewed the agreement during the merger’s due diligence process.
Tilray later communicated to Docklight its intentions to withdraw from the deal unless Docklight made certain concessions. The cannabis firm argued that the license was “too expensive,” despite its reported $376 million cash reserves and claims of strong sales of the Marley-branded products.
In addition, Docklight alleges that High Park continued to sell the licensed products without making minimum royalty payments. High Park is also accused of further violating the agreement by failing to develop product or marketing plans, excluding the licensed products from press releases, and discontinuing product lines without notice or explanation.
Docklight said Tilray and High Park refused to provide sales statements as requested, with some documents only surfacing during the discovery process.
As a result, Docklight was unable to pay the licensing fees to the Marley estate, which subsequently terminated the license in April, even though Docklight expected to retain it for another two decades.
The complaint lodges a single claim for breach of contract. While the total damages remain undetermined, the lawsuit expects the financial loss to be substantial.
This isn’t the first instance where a company has faced issues with a Marley-branded cannabis product. Last year, Silo Wellness decided against moving forward with Marley One, citing lack of profits and insurance issues.
That led to the termination of the Marley One royalty agreement in 2022, which accrued a $2.65 million advertising fee for royalty payments due on the termination of the agreement. Silo then removed these liabilities from the balance sheet by divesting the subsidiary that carried the debt.
“It was a pointless endeavor for us to advance this asset given the Marley debt that was marooned in this subsidiary,” Silo Welness CEO Mike Arnold said in April. “We attempted to negotiate terms with the Bob Marley family as previously disclosed, to no avail.”
