PORTLAND, Ore. (KOIN) — The former leaders of an Oregon-based CBD company have reached a settlement with the investors who accused them of violating several securities laws established by the state.
As first reported by the Oregonian/OregonLive, a settlement notice was filed in the Multnomah County Circuit Court on Oct. 23 after almost two years of legal back-and-forth between the former Sentia Wellness executives and the seven investment groups who said they were misled by the company.
According to the initial lawsuit filed in January 2022, Sentia’s founder and former executive chairman Nitin Khanna told investors false statements that led to them buying more than $75 million in unsecured loans for the company.
In April 2019, the suit alleged that Khanna notified investors of his plans to separate his company Cura Partners from its subsidiary CBD business, which became the standalone brand known as Sentia Wellness.
The plaintiffs accused Khanna of misrepresenting the company’s financial standings so they would put more money into it.
Documents say the founder told investors Sentia would receive monthly payments from customers, the brand would be sold in dispensaries, and that the company would make more than $175 million in revenue by the end of the year — among “other untrue statements and material omissions.”
The civil suit alleged that Khanna’s colleagues “participated in and materially aided” the founder as he misled investors. Overall, the plaintiffs disclosed that they had lost at least $60 million in damages.
Later that May, Khanna and his fellow defendants in the original case launched a countersuit starting at $515.6 million against the initial plaintiffs.
The defendants confirmed certain claims made in the original lawsuit, including the one that accused Khanna of giving plaintiffs his opinion on why they should invest in the new standalone CBD company.
However, they denied that Khanna misrepresented or omitted information on the company’s financial standings, and that he and Sentia president actively participated in the negotiating, drafting and editing of the investment agreements.
Nearly a year and a half after the counterclaim, a notice of settlement was issued in the Multnomah County Circuit Court.
“The parties to this action have reached an agreement to resolve all claims, counterclaims, defenses, and disputes between and among them asserted in this action,” the document from Oct. 23 said. “The parties are working toward performing certain obligations under that agreement.”