Kushy Punch-Running Bootleg and Legit Vape Carts

Way less than 50%. Also, with indications in the article that other companies who are legit are likely doing the same thing. Running a potentially dangerous method of extraction on less than optimum product and rolling that out into sub markets.

Link: [link to www.leafly.com (secure)]



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California vape maker Kushy Punch caught making illegal products
David Downs
October 4, 2019
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California state officials confiscated these Kushy Punch vape cartridges in their investigation of the company's unlicensed Canoga Park facility. (Courtesy of CA Dept. of Consumer Affairs)
California has a troubling new wrinkle in the vaping story rocking the nation.

Acting on a tip, state officials raided a warehouse in Canoga Park and discovered an illegal manufacturing operation.

Prompted by a tip, investigators at the California Department of Consumer Affairs served a search warrant on Thursday, Oct. 3, at a light industrial space in northwest Los Angeles’ Canoga Park district.

There they found an illegal cannabis product manufacturing operation apparently operated by Kushy Punch, a legal state-licensed company. Authorities seized a number of finished products, including gummies in Kushy Punch packaging and disposable vaporizers in Kushy Vape packaging.

In photos obtained by Leafly, the facility appeared to be performing petro-solvent extractions, where a technician concentrates the active ingredient in cannabis, THC. Petro-solvent extraction is legal with a permit in California. The extraction method can sometimes have the effect of concentrating pesticides along with the THC.

California officials documented slabs of raw THC oil fresh from the extractor. (Courtesy of CA Dept. of Consumer Affairs)
Edibles and vape cartridges seized

The San Fernando Valley facility appeared to be in the business of putting those extracts into professional-looking THC foods as well as disposable vape pen cartridges. Tall file cabinets held thousands of boxes of Kushy Vapes pens and Kushy Punch edibles packaged and ready for sale and consumption.

“Investigators confiscated thousands of illegal vape carts worth millions of dollars,” Bureau of Cannabis Control spokesperson Alex Traverso told Leafly. The investigation is ongoing.

Kushy Punch CEO Ruben Cross did not answer Leafly questions via email, or text, nor did he return phone calls or voicemails.
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Kushy Punch under scrutiny

A source familiar with Kushy Punch accused the adult-use licensee of maintaining two facilities: one licensed and one black market. (Leafly is granting the source’s request for anonymity because disclosing their personal information might endanger their own safety and the safety of others.)

A source close to Kushy Punch alleges the company maintained two facilities: one licensed and one black market.

The source alleges that cannabis that tested clean went through Kushy Punch’s licensed facility and into the licensed supply chain.

The source also says cannabis that might fail the state’s stringent pesticide standards went to the illicit extraction lab, pen factory, and kitchen located at 8427 Canoga Ave. in Canoga Park. That facility sits on the same block as the Los Angeles Police Department’s Topanga Community Police Station.

“This is where they have all black market operations going,” the source told Leafly. “They are using untested black market oil that is heavy in pesticide.”
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Kushy Punch CEO Ruben Cross did not respond to Leafly’s attempts to reach him to address the accusations.

Kushy Punch’s licensed edibles are manufactured and distributed by Vertical Bliss Inc. of Northridge, a legal state cannabis licensee, according to documents posted on the KushyPunch.com website.

Packaging machinery at the Canoga Park facility investigated by California state officials on Oct. 3. (Courtesy of CA Dept. of Consumer Affairs)
BCC investigation ongoing

The BCC said its investigation has the same information, is testing the oil, and examining the possible links between the raided facility and the Kushy Punch brand, said BCC spokesperson Alex Traverso.

“Everything about this tip has checked out 100%,” Traverso told Leafly. “Based on the tip, there is a legal side of things and an illegal side of things. We’re still investigating both sides of the equation.”

“If this is something we’re seeing linked back to someone who has a license I would be surprised if they had a license much longer,” Traverso added.
Split operations detailed

California’s adult-use cannabis market is one year and nine months old. The state’s medical marijuana era lasted 23 years. Kushy Punch operated during both eras.

Leafly’s source alleged that Kushy Punch management split the legal business from the illegal one when the company obtained a state cannabis manufacturing license. The source said Kushy Punch managers assigned the same staff members to work both the legal and illegal facility.

The company’s website also states that Kushy Punch is selling its products into both markets.

Kushy Punch describes itself as “California’s #1 edible” and provides a store locator tool listing licensed stores.

But it also states that it manufactures edibles and vape products for “California collectives and clinics for California medical card holders.” Commercial medical collectives became illegal on Jan. 1, 2019. All retail sales must go through a state-licensed adult-use or medical retailer. Licensed cannabis retailers must only carry products from licensed cannabis manufacturers.