Pueblo cannabis company to pay $225,000 for misrepresenting hemp products
DENVER, Colo. (KRDO) - Colorado Attorney General Phil Weiser announced that he has reached a $225,000 settlement with Pueblo-based Bee's Knees CBDs and its owner Joseph Leyba.
According to the Attorney General's office, a state investigation found the company made several misrepresentations on its website regarding the source of its products, wrongly characterized some products as "organic," lacked a proper age verification system on its website, and lied about supporting conservation groups. The fine could grow to $495,000 if the company fails to comply with the full terms of the settlement.
“Colorado is committed to maintaining an effective system of overseeing the sale of legal cannabis products—one that keeps it out of the hands of kids, ensures safety standards, requires chain-of-custody tracking, and gives consumers important information about the products they buy. In this case, the company misrepresented to their customers the source and nature of their products and sold intoxicating products without verifying the age of customers. This settlement will hold them accountable for those violations of the law and will ensure compliance in the future.”
Phil Weiser, Colorado Attorney General
Bee’s Knees markets a variety of industrial hemp extracts on their website, both intoxicating and non-intoxicating. Industrial hemp, which has been legal under federal law since 2018, must contain less than 0.3% of the psychoactive chemical Delta-9 THC.
According to the State Attorney General's Office, despite claiming that their products, which they sell mostly to wholesalers, are produced in Colorado and are organic, the company’s owner admitted to investigators that these claims are false. Further investigation found the company used allegedly altered and expired hemp licenses and testing documents to misrepresent their products as complying with the law.
Officials say the company also failed to institute an age verification system on their website, despite selling intoxicating hemp products in gummy and chocolate form that contain as much Delta-9 THC as products found in regulated marijuana dispensaries.
Additionally, Bee’s Knees claimed on its website that the company was associated with several conservation nonprofits—claims that investigators say were false. After the Attorney General’s Office confirmed these claims were false, Bee’s Knees removed the names, logos, and claims of association from their website, investigators say.
In a release, state officials say that top of paying fines, Bee’s Knees agrees to fully comply with state law, including all representations it makes to customers. The company will be required to thoroughly vet any raw materials used to make its products. The agreement also requires the company to obtain all required licenses and permits to legally conduct business related to cannabis products and, if requested, provide those documents to the state within 10 business days. Finally, Bee’s Knees is required to add age verification to their website as well as remove any misrepresentations about their products or associations with nonprofits.
Consumers are encouraged to report any deceptive marketing or other misrepresentations made by businesses to the attorney general’s office at StopFraudColorado.gov or by calling 1-800-222-4444.
