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3w ago

Supreme Court Allows RICO Lawsuit Against CBD Firm Over False Advertising

In a 5-4 decision, the court upheld a lower court ruling, enabling truck driver Douglas Horn to pursue claims that mislabeling of a CBD product led to his job loss.

FILE - The Supreme Court at sunset in Washington, Feb. 13, 2016. (AP Photo/Jon Elswick, File)
A view of the U.S. Supreme Court in Washington, U.S. June 29, 2024. REUTERS/Kevin Mohatt/File Photo
Scaffolding on the US Supreme Court in Washington, DC, on Saturday, March 22.
FILE - The Supreme Court in Washington, June 30, 2024. (AP Photo/Susan Walsh, File)

Overview

  • The U.S. Supreme Court ruled 5-4 to allow Douglas Horn's civil RICO lawsuit against Medical Marijuana Inc
  • Horn alleges that a CBD product falsely advertised as THC-free led to his firing after a drug test detected THC in his system.
  • The lawsuit claims the company engaged in a 'pattern of racketeering activity,' including mail and wire fraud, under the RICO Act.
  • The decision affirms a 2nd U.S. Circuit Court of Appeals ruling, which reversed an earlier dismissal by a federal trial judge.
  • This ruling could set a significant precedent by expanding the application of the RICO Act to cases involving product liability and false advertising.