Berkeley Patients Group, one of the city’s oldest dispensaries, is being sued and stands to lose more than half a million dollars in loans it provided to a medical marijuana group it helped establish in Maine.
Non-profit Northeast Patients Group, based in Maine, filed a countersuit Aug. 15 in response to a lawsuit the Berkeley group filed against it and its current executive director, Rebecca DeKeuster.
DeKeuster, who had been with the Berkeley group since 2004, was sent in November 2009 to help establish the Northeast group and receive state approval for the creation of dispensaries.
According to Charles Remmel of Kelly, Remmel and Zimmerman, the law firm representing the Berkeley group in the proceedings, the countersuit alleges the group did not provide Northeast with enough startup funds.
DeKeuster assumed her position as Northeast’s executive director in June 2010.
“(DeKeuster) was employed by BPG and was sent out to see if she could get this operation going because some of the BPG people are from Maine, and they wanted to see if this could work,” Remmel said.
In its lawsuit, Berkeley Group alleges that DeKeuster “acted with the intent to prevent the execution of the contracts and loan documents and to mislead BPG” and the Maine Department of Health and Human Services, which granted the company permission to dispense medical marijuana.
The Berkeley group is suing DeKeuster for entering into a contract with a competing party.
The Berkeley dispensary has accused DeKeuster and Northeast of non-repayment of debt, unjust enrichment and use of confidential information, while DeKeuster is also accused of breaching her employment agreement and fiduciary duty.
The lawsuit states DeKeuster entered into a letter of intent with “the competing business group” — unnamed throughout the lawsuit — on or around Feb. 24. DeKeuster resigned from the Berkeley group the same day.
“Things went along for a while, looking for investors, and I believe in February of 2011 BPG identified some people in Maine, and Becky found this other wellness group and basically said, ‘We’re not talking with you anymore, and we’re putting them in the place you were going to be in, and by the way, we’re not paying you the advance on the loans either,’” Remmel said.
According to documents submitted Aug. 4 by Daniel Walker, attorney for Northeast Patients Group, to the Maine Department of Health and Human Services regarding Northeast’s financial agreement with the Wellness and Pain Management Connection LLC — a group created in Delaware on Aug. 3 that includes retired NBA player Cuttino Mobley and the Los Angeles-based Farmacy Institute for Wellness — the agreement would provide $1.6 million in funding to the Northeast group over the next eight years, with an annual interest rate of 8.5 percent.
Remmel said the Northeast group has not received funding from the LLC and has yet to open any dispensaries.
However, JoAnna LaForce, clinical director of the Farmacy Institute for Wellness, said her organization has not entered into any agreements with the group, Mobley or the LLC.
“I know there was an article in the Portland paper … saying that we were in a financing agreement with the Farmacy Institute and Cuttino Mobley,” LaForce said. “That’s not true at all.”
LaForce said the only connection the institute may have with Northeast group is that the institute is likely to help LLC provide clinical and operational services to the group.
Read the lawsuit filed against the Northeast Patients group here: