Pennsylvania woman sues CBD company after failed drug test

A woman from Pennsylvania who was fired from her job after testing positive for cannabinoids has sued a marketer of CBD (cannabidiol) products in the Superior Court of Los Angeles County.

Koi CBD LLC advertised its products as being free of THC—the psychoactive compound responsible for the “high” from using marijuana—and legal in all 50 states, the April 8, 2019 complaint alleged. But the company allegedly failed to disclose a person using its products could nonetheless fail a drug test. 

According to the lawsuit:

“Koi’s THC-free claims, without qualification that using the products can result in a failed drug test, are deceptive because it communicates to a reasonable consumer that the guaranteed absence of THC means a person will not fail a drug test,” the lawsuit alleged.

According to the lawsuit, Thurston worked for DWL for about one year before she was let go. Prior to June 2018, she had been subject to multiple random drug tests and had never failed a test, the lawsuit said, adding Thurston was only recently able to secure permanent work elsewhere after being terminated from DWL.

Boxes of Koi’s CBD Vape Juice that Thurston was shown while shopping at the mall included a Supplement Facts panel and specified the product was made with “0% THC,” according to the complaint.

But Koi faces accusations that it markets its products as being able to treat various diseases and conditions, including, among other things, arthritis and other inflammation-related diseases, cancer and its side effects, chronic pain, depression and post-traumatic stress disorder, and heart disease.

“Yet, despite their sundry claims for disease treatment, Koi’s products have not been approved by FDA for any health-related purpose,” the lawsuit stated.

According to the complaint, Koi often promotes its products as treating diseases through testimonials.

“I suffer from low back issues (bulging discs, nerve pain) and arthritis from old injuries,” the lawsuit quoted one testimonial. “I also do not sleep well from an ever-changing work schedule. Koi has significantly reduced my lower back pain and arthritic pain, and almost immediately puts me in a very pleasant state of relaxation.”

Coni Hass, a California resident who purchased Koi’s products between March 2017 and March 2018, is a co-plaintiff in the case. The complaint suggested she was looking for products that would help treat or ease arthritis, inflammation and other pains.

Both women purchased Koi’s products before President Donald Trump signed legislation in December 2018 that removed hemp and its derivatives such as CBD from the Controlled Substances Act (CSA). Prior to the passage of the 2018 Farm Bill, the Drug Enforcement Administration (DEA) maintained CBD was a schedule I controlled substance, though the hemp industry—including marketers of CBD—vigorously disagreed with the agency’s interpretations of federal law.

The 82-page complaint filed against Koi alleged negligence as well as violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law, California’s Unfair Competition Law and California’s Consumers Legal Remedies Act.

The plaintiffs are demanding a jury trial and seeking compensatory damages—including the amount related to Thurston’s job loss and what they paid for the products—punitive damages, a declaration and order prohibiting Koi from labeling or advertising its products as drugs, and an order awarding plaintiffs their costs and attorneys’ fees.

Koi did not immediately respond to multiple requests for comment. Wyatt Lison, an attorney in Pittsburgh representing the plaintiffs, said he and his clients generally don’t comment on pending litigation in response to a request for an interview with Thurston.

DWL, Thurston’s former employer which provides services to the oil and gas industry, did not immediately respond to a request for comment.

Justin Prochnow is a shareholder in Denver with Greenberg Traurig LLP who advises companies on compliance with FDA regulations. The attorney isn’t involved in the litigation involving Koi, but he reviewed the complaint filed against the company.

Commenting on the lawsuit’s argument that Koi should have disclosed consumption of its CBD products could have resulted in a failed drug test, Prochnow said, “I disagree with that proposition. Too often, we expect companies to have to disclose everything.”

He suggested the larger concern facing Koi relates to the purported disease claims, though he identified some issues defense counsel might raise, including an argument that whether a disease claim is being made is within FDA’s authority. He also pointed out just because FDA hasn’t approved a product to treat a disease, doesn’t necessarily mean the claim is untrue.

“Is that really a false and misleading claim to say it will cure or prevent arthritis when it hasn’t been approved for that?” asked Prochnow in a phone interview.

On the other hand, a company marketing products as dietary supplements can’t circumvent the general prohibition against making disease claims by publishing customer testimonials, he said.

“You can’t use a testimonial that says anything that the company could not expressly say itself because once you use it, you are essentially adopting that as a statement of the company,” Prochnow explained. “Any endorsements, testimonials [or] reviews that talk about treatment of disease essentially become claims of the company that the product will treat disease.”

Koi faces another potential problem. While its boxes labeled its CBD vape juices with a Supplement Facts panel, FDA said in a 2012 warning letter that products intended for inhalation are distinguishable from dietary supplements, which based on their definition in federal law must be intended for ingestion.

“Your labeling is false and misleading because your product cannot be intended for both inhalation and ingestion,” FDA wrote to Breathable Foods Inc., the marketer of an “AeroShot” product described at the time as “inhalable caffeine” on its website. “The functioning of the epiglottis in the throat keeps the processes of inhalation and ingestion mutually exclusive.”

Similarly, a CBD vape juice, Prochnow said, “cannot be a supplement.”

“This is a common problem with some of these products,” the lawyer added.