Organigram Responds to Proposed Class-Action Suit

MONCTON, NB – MARCH 7, 2017 – Licensed marijuana producerOrganigram Inc. and its parent company Organigram Holdings Inc. (TSX-V:OGI, OTCQB:OGRMF)(collectively, the “Company” or “Organigram”) will launch a strong defense against a proposed class-action suit related to recent voluntary product recalls.

The Company was served with notice of the proceeding yesterday.  The proposed suit was filed with the Supreme Court of Nova Scotia by a Halifax-based law firm.  The filing seeks to represent Organigram clients who purchased and consumed medical marijuana that was later found to contain trace elements of the pesticides myclobutanil and bifenazate which are not approved for use by licensed growers.

Denis Arsenault, Organigram’s Chief Executive Officer, said the Company offered all non-insured clients impacted by the voluntary recall an account credit equal to the full purchase price of the recalled product.  He also noted that public comments made yesterday by the lawyer seeking to bring the action had erroneously stated Organigram had offered refunds to its clients instead of providing account credits and newly harvested marijuana. “We have been in constant communication with clients who purchased recalled product. We have been clear that Organigram will meet their needs by providing account credits valued at 100 per cent of that product’s value and will make freshly harvested and tested product available to them. The majority of our clients are very satisfied with this action and are already using their credits.”

“In terms of the proposed class-action suit, we intend to vigorously defend our company and its actions related to the product recall,” stated Arsenault.  “We have already engaged Borden Ladner Gervais LLP, one of Canada’s leading class-action defence law firms, to assist with our defence.” The Supreme Court of Nova Scotia will likely take a number of months to determine if it will allow the proposed suit to proceed as a class action. “In the meantime, our primary focus will be on meeting the needs of our clients,” he said.

“From a financial perspective, we believe there is very little exposure for Organigram going forward,” said Arsenault. “We have already allocated $2.26 million this quarter to cover losses associated with the recalls,” he said.  “We are also talking with our insurer about the company’s coverage related to the proposed class-action suit should the court allow it to proceed.”

Organigram recently completed a thorough investigation into events that led to the December and January voluntary recalls. As a result of that investigation, the company put a number of new growing and harvesting protocols in place.  All marijuana harvested since the recall has tested negative for pesticides.  “We have also decided to post all testing results on our website beginning next week,” said Arsenault. “With the new procedures in place, we are fully confident in our ability to deliver high-quality product to our clients.”

 

For further information, please contact:

Organigram Holdings Inc.
Denis Arsenault
Chief Executive Officer
denis@organigram.ca

 

Organigram Holdings Inc.
Giselle Doiron
Director of Investor and Media Relations
(506) 801-8986

 

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