Judge Allows Hemp Oil Seller’s Defamation Suit to Continue

(CN) – A federal judge will allow a hemp oil company’s defamation suit to continue against a Florida doctor interviewed by a local TV news station.

U.S. District Judge John Steele denied Dr. Joseph Dorn’s request to dismiss the lawsuit filed by AFI Holdings of Illinois last year over the doctor’s comments to a reporter about a hemp oil product.

According to AFI, also known as Happy Leaves Inc., a reporter with WBBH-TV interviewed Dorn about the company’s distribution of a hemp oil extract through the online sales website Groupon.

Anchors of the July 2016 newscast described the product as “medical marijuana” and “pot” and a reporter questioned the legality of selling it on Groupon, the complaint states. In the segment, Dorn is quoted as saying “somebody like this, they’re not playing by the rules, so who in the world knows what they’re selling,” according to the complaint.

On its website, AFI says the “Charlotte’s Web” product is derived from hemp, which has very low amounts of tetrahydrocannadion, or THC, which is the psychoactive chemical in recreational marijuana. The main ingredient is cannabidol, or CBD, and does not produce a “high.”

AFI says the Charlotte’s Web extract contains less than 0.3 percent THC. Florida only regulates products with 0.5 percent or more THC, according to the Florida Department of Health.

“Charlotte’s Web” is manufactured by the Colorado-based Stanley Brothers. The product is named after a child who suffered from severe epilepsy and found relief after taking the tincture. Several companies also sell CBD oil as a dietary supplement.

After the newscast aired, AFI says Groupon discontinued all sales of Charlotte’s Web.

Two weeks later, the news station posted a retraction of the story on its website.

AFI first brought the lawsuit to Chicago federal court. The case was moved to the Middle District of Florida last year. In addition to the doctor, AFI named Waterman Broadcasting, which owns WBBH-TV, reporter Graham Hunter and on-air anchors Lisa Spooner and Peter Busch.

“It’s been devastating for his professional and personal life,” said AFI’s attorney Patrick Walsh of AFI’s owner, Tim Fligg.

The complaint claims AFI lost sales of more than $1.2 million. The company is seeking $1 million in damages for defamation and commercial disparagement.

In his order, Steele said Dorn’s statement could be considered a “mixed expression of opinion and fact.”

“Dr. Dorn’s statement, ‘they’re not playing by the rules’ at a minimum implies to the listener that AFI is doing something improper by selling Charlotte’s Web on Groupon in Florida, which by its nature is injurious to AFI,” the judge wrote.

Dorn’s attorney, Robert Beasley of the Litvak Beasley Wilson & Ball law firm, said the doctor was expressing “a general warning” for consumers to be careful with such products.

“His whole point is one any conscientious physician would make,” Beasley said by phone. “It’s really just mimicking the FDA warnings. It isn’t slander against a particular product.”

Last year, the Food and Drug Administration sent warning letters to several hemp oil manufacturers, including the company responsible for Charlotte’s Web, for making unsubstantiated health claims. The FDA accused other companies’ products of not containing the levels of CBD advertised.

Dorn currently works as a chief medical officer with Medical Marijuana Treatment Clinics of Florida, which has practices all over the state.

The news station did not request a dismissal. In court filings, attorneys for the station assert the anchors and reporter are protected by the First Amendment.

Douglas Szabo, lead attorney for Waterman Broadcasting, did not respond to a request for comment.

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