Charleston-area hemp-processing agency accused of skipping out on its lease | Enterprise

RIDGEVILLE — A hemp processing enterprise that when promised tens of millions of {dollars} in funding and dozens of jobs in Dorchester County is being sued by its landlord for abandoning its Pine Hill Enterprise Park campus and failing to pay lease.

Magnolia Botanicals, one in every of a handful of startups that sought to enter the cannabidiol — or CBD — oil market after South Carolina legalized hemp farming in 2018, owes an unspecified quantity of again lease, in response to a lawsuit filed by forestry analysis agency ArborGen, which listed its earlier identify of Rubicon Industries USA in authorized papers.

ArborGen had been leasing workplace house and greenhouses at its Pine Hill headquarters to Magnolia since July 2019 at a month-to-month charge of about $48,000, in response to court docket paperwork. The lawsuit doesn’t state when the tenant stopped paying lease and deserted the location, however the landlord stated it’s owed all the cash that may have paid all through the seven-year time period of the lease — greater than $4.25 million together with yearly scheduled will increase.

Magnolia can be named as a defendant in a separate grievance filed by Linden Building of South Carolina, which alleged it is owed $462,000 for work it accomplished on the hemp-processing facility.

Tom Goodwin, head of Magnolia, didn’t reply to requests for remark this week. The corporate has not filed formal responses to the lawsuits and its phone quantity has been disconnected.

Richard Mudd, the Magnolia’s former CEO, stated the monetary issues began when a key associate within the deal filed for chapter safety in April 2020.

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Colorado-based United Hashish Corp., which was looking for to reorganize its funds, was presupposed to function the Dorchester County web site below a three way partnership with Magnolia. Its chapter case was dismissed after a decide dominated the corporate’s property and operations have been largely tied to the unlawful marijuana market.

New hemp regulations, incentives lure Magnolia Botanicals to SC

“That was actually tough for the corporate,” stated Mudd, who resigned as Magnolia’s president in December. “Operators do not develop on timber for these kinds of methods. It was a extremely powerful position for us to fill.”

Mudd declined to touch upon the current authorized motion, saying he hasn’t been with the corporate for months and is not conscious of Magnolia’s present scenario.

The corporate introduced its hemp-processing plant in December 2019, promising a $3.2 million funding and 52 new jobs at a web site that may produce cannabidiol to be used in lotions, oils, edibles and different merchandise geared toward folks with medical situations corresponding to neuropathy, arthritis, sleep issues, nervousness and different points.

Though the corporate was eligible for property tax breaks from the county and tax credit from the state, it isn’t clear whether or not it was in operation lengthy sufficient to qualify for both.

Unproven but undaunted, hemp firms seek same SC tax breaks as old-line manufacturers

Attain David Wren at 843-937-5550 or on Twitter at @David_Wren_


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