Coastal Dispensary Purchased for $56 Million
Santa Barbara Cannabis Retail Company’s Partner Objects and Files Suit
The convenient and popular cannabis shop Coastal Dispensary in downtown Santa Barbara is mired in a contractual dispute between its owners over a pending $56 million sale of the company to California marijuana conglomerate The Parent Company, famously backed by Jay-Z, who is The Parent Company’s “chief visionary officer” for Black entrepreneurship.
Coastal won one of three cannabis storefront licenses granted by Santa Barbara in a “beauty contest” of attributes in 2018 that included the localness of its owners as well as their presumed probity. The stores earned a faithful following with 4/20 sales and other perks, but according to court documents and the marijuana media, Santa Barbara frontmen Julian Michalowski and Malante Hayworth shared management of the company with at least four other people, among them Adam Bierman, one of the Los Angeles–based MedMen, a wildly successful then wildly disastrous cannabis company, as described by Politico last year.
A suit filed in September by LMAJ LLC, which lists Bierman and his MedMen partner Andrew Modlin among its officers, alleges that Coastal arranged its sale and loans but left him out of the decision making. The complaint charges the loans underwrote the company until the “fire sale” of Coastal — the sale is projected to close in 2022 — and carried terms that benefited the other owners while diluting Bierman’s share of the company.
