A $69 million lawsuit over control of Owensboro-based hemp processing company Bluegrass Bioextracts has been settled amid controversy surrounding the company not paying out potentially hundreds of thousands of dollars in contracts to hemp farmers.
Plaintiff Gerald Edds is one of the former Bluegrass Bioextracts owners who sold his company last year to a Nevada-based limited liability company, DTEC Ventures. Edds, along with other former owners, sued DTEC Ventures last month for multiple reasons including not fulfilling contracts to hemp farmers.
Edds said the settlement will have former owners reacquiring hemp processing equipment owned by Bluegrass Bioextracts, with no money being exchanged between DTEC Ventures and the former owners. With the equipment, Edds said he’s planning on starting a new hemp processing company by this summer, called Precision Biotech, LLC.
“I wanted to get paid for the business. That’s what we really wanted,” Edds said. “It was obvious they’re not going to pay for it. The best we could settle for was to get our equipment back and try to start over.”
He said because Bluegrass Bioextracts is still owned by DTEC Ventures, the Nevada-based company is still responsible for paying out contracts to farmers. Representatives with DTEC Ventures did not respond to a request for comment.
The Bluegrass Bioextracts contracts signed last year potentially promised farmers around $40-$50 per pound of hemp that would be processed into CBD products. That price has crashed more than 75 percent over the past six months.
“You think they’re going to pay 50 dollars a pound when you can’t get five dollars a pound for it? I don’t think so,” said Jamie Shaddock, a Shelby County hemp farmer who contracted to grow hemp for Bluegrass Bioextracts. “I don’t have no confidence in nobody in this hemp game because it’s 99 percent B.S.”
Shaddock said instead of waiting to get paid by Bluegrass Bioextracts, he’s working with other hemp companies to process his hemp crop so that he can cut his immediate losses.
Edds said after the controversy surrounding his former company, it’s going to take time to rebuild trust with hemp farmers and other stakeholders with his new company.
“I hope to be back in business by July and going back to work, but there’s a lot of damage to correct,” Edds said. “It’s going to be a real chore.”