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Tuesday, May 21, 2024 | Back issues
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Pot-Growing Consultant Complains of ‘Cartel’

PHOENIX (CN) - Hydroponic equipment suppliers formed a cartel and conspired to shut down a gardening consultancy that caters to growers of medical marijuana, the business claims in court.

Singh Dispensary Solutions dba weGrow Phoenix "markets itself as the first 'honest' hydroponics business and consulting service because qualified customers can receive consultation on medical marijuana gardening if they have an approved Arizona Department of Health Services medical marijuana card," according to the complaint in Maricopa County Court.

Around the time of its opening in June 2011, CNN reported that weGrow has been nicknamed the "Wal-Mart of Weed," and that the Arizona big-box store was expected to have a customer base of 100,000 people with medical marijuana ID cards. The franchise reportedly has other locations in California and Washington, D.C., both of which have medical marijuana programs similar to that of Arizona.

Despite the buzz surrounding its opening, weGrow says that a cartel of the leading wholesale dealers of hydroponic light and gardening supplies have conspired to run it out of business.

There is nothing illegal about weGrow, as it "retains no marijuana plants or marijuana seeds at the business location, and does not operate as a medical marijuana dispensary, nor does plaintiff have any affiliations with any medical marijuana dispensary," according to the complaint.

As such, weGrow says it is an arbitrary, capricious and illegal trade restraint for Sunlight Supply, Hydrofarm, BWGS, and R & M Supply to collude against it.

Hydroponic farming - the practice of growing plants in water without soil - "is nothing new to arid dry climates like Arizona, and has been considered a dominant farming method in the arid Southwestern region since well before the Territorial Days," the complaint says.

"Defendants Sunlight Systems, Hydrofarm, BWGS, and R & M Supply Inc., seized upon their substantial market power and the fewness of firms in Arizona to exclusively control the wholesale hydroponics supply market in the state of Arizona, all to the detriment of plaintiff and Arizona consumers," weGrow says.

Because of the quartet's "illegal hydroponics cartel," Arizona customers are left having to pay "higher prices for hydroponic equipment, limited purchasing options and non-enforceable warranties," according to the complaint.

WeGrow sys it has also had "to locate alternative suppliers of the desired hydroponic equipment secretly, and at an increase price with no return policy for its customers or direct communication with defendant wholesalers."

The defendants' refusal to do business with weGrow "condemns Arizona consumers interested in hydroponic gardening to weaker plant nutrients systems, slower crop growth, smaller yield, and substantially more costs and wasted time for Arizona hydroponics consumers," weGrow says.

It also allegedly denies Arizona customers "innovative hydroponics products such as computerized environmental control systems, automated injector feed systems, plastic plumbing and grow bags, top of the line grow lights, and other technological innovations that have allowed growers to become increasingly efficient in their production of crops using top of the line hydroponics, thereby reducing both capital requirements and operational costs."

WeGrow seeks punitive damages for violations of the Arizona Antitrust Act, intentional interference, trade disparagement and unjust enrichment. It is represented by Elvin Grundy III.

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