Major Kentucky hemp firm files for bankruptcy

Major Kentucky hemp firm files for bankruptcy

GenCanna Global, a Kentucky-based hemp company, recently filed for Chapter 11 bankruptcy in the face of scandals and legal trouble.

The company announced the bankruptcy restructuring filing after it faced multiple lawsuits, liens and other issues. It had been seen as a leader in Kentucky, which itself has been at the forefront of CBD and hemp issues.

Sen. Mitch McConnell, R-Kentucky, was one of the key drivers behind the 2018 Farm Bill, which legalized industrial hemp cultivation for the first time in decades.

Kentucky and other southern states have gravitated to industrial hemp as demand for tobacco crops has waned, and many states and even facilities where tobacco used to be dried and processed are now buzzing with CBD extracting operations.

CBD is a non-intoxicating hemp extract that people use for their chronic pain, anxiety, insomnia and forms of epilepsy.

The Louisville Courier Journal reports that as many as 60 farmers across Kentucky sued GenCanna for allegedly selling them bad hemp seeds for planting. [2]

The Chapter 11 filing includes a list of 81 farmers, companies and contractors who had money invested in GenCanna. $13 million in liens were brought against the company by contractors in October, the Courier Journal reports. [2]

Just how much the company owes to shareholders, investors and workers is not clear at this time.

"I'm very disappointed in how GenCanna has left so many contractors from my district high and dry with their plant, when they just walked away from them in Mayfield, Kentucky,” U.S. Rep. James Comer told the Courier Journal. [2]

If farmers use the wrong seeds, they can be less potent than desired or even register as “hot” harvests with too much THC content. THC is the active ingredient in marijuana and industrial hemp is monitored to ensure it clocks in at 0.3% THC or less.

“While this is certainly not the outcome we desired,” said GenCanna CEO Matty Miranda in a statement, according to the International Business Times. [1]

“The bankruptcy process gives us the ability to move forward in a way that allows us to best continue operations and serve customers as we work through our reorganization, resolve an outstanding legal dispute involving our Western Kentucky facility, navigate an uncertain regulatory environment and adjust our annual operating costs to better match the landscape.” [1]