The deals never went through. “Unfortunately, it did not make sense to proceed with those acquisitions after further due diligence,” Levin said.
In February, after High Times announced that it would reveal the winners of its Cannabis Cup from the main stage at Spannabis, the Spanish company labeled the announcement “FAKE,” and disavowed any relationship with High Times. Levin did not respond to a question about the episode.
When High Times isn’t being disavowed, it’s being sued. According to court records, the magazine’s parent company, Hightimes Holding Corp., or its subsidiaries have been named as defendants in more than a dozen lawsuits since the beginning of 2017, for breach of contract and other alleged misdeeds, though the company has denied wrongdoing.
Last year, Southland Publishing, which sold the cannabis magazine Culture to High Times, sued in California over the acquisition, alleging High Times had violated their agreement by failing to issue it a promissory note for $2 million or begin making payments it owed. Hightimes Holding Corp. denied the allegations, and the case remains ongoing.
In January, Puerto Rico resident Merlin Kauffman sued High Times in federal court, alleging he had negotiated the purchase of the internet domain 420.com with Levin over WhatsApp. Kauffman wired the company more than $300,000, but the company has refused to turn over control of the domain, according to the complaint. High Times has denied wrongdoing, alleging that Kauffman wired the money before a final agreement had been reached and that it has offered to refund his payment. The case remains ongoing.
Even High Times’ lawyers have sued High Times. In February, a court in New York awarded the New Jersey law firm Ansell, Grimm and Aaron a $138,000 judgment against High Times, a subsidiary and Levin for unpaid legal fees.
When disability rights advocate Rena Wyman sued a High Times subsidiary in federal court in 2018 over wheelchair accessibility at the Cannabis Cup, the case settled. But in June Wyman sued again, this time in California. She alleged High Times never forked over the $40,000 in cash and $10,000 in stock that it agreed to pay, a claim that the company denied.
“High Times, specifically Adam Levin, shows us who he is time and time again. 273 days delinquent,” wrote Wyman in a July email. “Fortunately, unlike other investors, there was a provision in my settlement that states the stock must be publicly trading within 6 months of signing the settlement or it reverts to cash.” In August, the case was dismissed with prejudice at the request of Wyman’s lawyer, according to San Francisco County court records, and Levin said High Times had fulfilled its obligations to her.
Even as the company delayed its IPO, it continued to market the $11 shares in emails that implored fans to “Invest today! … before time runs out!”
Sophisticated investors, though, have gotten effective share prices that are far lower, according to SEC disclosures. In one case, it disclosed a deal in January with an Ontario firm, RayRay Investments, to sell it $2 million worth of stock at $5.50 a share.
Levin said the RayRay deal was for unregistered stock that was subject to a holding period before it could be re-sold.
“Adam is a great stock promoter,” said a former executive. “Just like Trump, he will keep on talking and you have to separate fact from fiction.”
Levin argues that High Times’ unique brand justifies its share price. “Value is subjective,” he said.
Levin undertook his remaking of High Times in the name of profitability, but over the past year the company’s financial outlook has dimmed.
Last fall, after falling behind on rent payments, it closed down a Seattle office. Soon after, it closed its office in New York, where the magazine had been headquartered for decades, trimmed salaries and parted ways with editor-in-chief Mike Gianakos.
High Times magazine cut back from monthly to quarterly publication, and in November the company disclosed to the SEC that it had lost almost $12 million in the first half of 2019, warning shareholders that its financial problems raised “substantial doubt” about its ability to keep operating.
In March, the company announced with fanfare that when it goes public, Hightimes Holding Corp. will trade under the ticker symbol HTHC—a play on Tetrahydrocannabinol, or THC, the main psychoactive compound in cannabis.
Soon after, it suspended publication of High Times, Culture and Dope, citing coronavirus.
In October 2019 there were 75 people on payroll, according to a person familiar with the company’s financials, but the number was down to 40 as of the beginning of this year. By mid-March, following layoffs and furloughs attributed to the coronavirus outbreak, the headcount was down to 12, this person said. In an August email, Levin said the company now has 117 people on payroll.
Many of the departures have been acrimonious. Several former staffers, including senior cultivation editor Danny Danko, a minor celebrity in pot circles, have launched a rival publication, Northeast Leaf.
Like many other bylines in the cannabis world, Danny Danko is a pseudonym, and after Danko left, Levin told him High Times owned the name and wanted compensation for his use of it. On a phone call, Danko offered Levin $1000 a year to license the name, an offer Levin rejected, according to a person familiar with the conversation. Danko said that if Levin wanted to press the issue, he could send him a cease-and-desist letter, which Danko promised to post on the internet to expose Levin’s “evil,” according to the person. Levin said he wanted a percentage of Danko’s earnings, and asked Danko what he thought he should get, according to the person, who said Danko responded 0 percent, and Levin hung up.
Levin said the “Danny Danko” trademark belongs to the company. “We offered him an opportunity to use the name but he declined.”
Danko continues to use the pen name on social media, while a press release for Northeast Leaf identifies him as “Dan Vinkovetsky (previously known as Danny Danko).”