In a developing story that has raised eyebrows in the cannabis industry, California-based cannabis megabrand Stiiizy is currently under investigation by New York authorities for allegedly smuggling marijuana from out of state into the licensed market. According to a report from The New York Times, the New York State Office of Cannabis Management (OCM) is probing Stiiizy along with several other companies for potentially “laundering” products through a state-licensed processor.
On April 6, 2025, the Times reported that OCM inspectors conducted a surprise audit of Omnium Canna, a Long Island-based processor affiliated with Stiiizy. The investigation centers on allegations of “inversion,” a term used to describe the insertion of marijuana products produced outside of regulated channels into the licensed supply chain. The OCM has been aware of inversion practices occurring in New York and recently established a Trade Practices Bureau to specifically address such regulatory violations.
The investigation also includes other cannabis brands such as Grön, Mfused, To the Moon, Turn, and Waahoo, which is Omnium Canna’s house brand. However, none of the companies involved have publicly responded to the Times’ request for comments regarding the investigation.
In a statement to MJBizDaily, Stiiizy CEO James Kim vehemently denied any wrongdoing, asserting that the OCM’s audit found Omnium Canna’s operations compliant with New York laws and regulations. “We are committed to operating within the legal frameworks of each state we serve,” Kim said, emphasizing the company’s dedication to compliance.
Conversely, a spokesperson for Grön labeled the Times’ report as “inaccurate” and asserted that the Oregon-based company is “not under investigation.” The allegations of inversion have circulated within the cannabis industry for some time, but Stiiizy stands out as one of the prominent brands linked to these claims.
The implications of this investigation are significant for Stiiizy, which has already faced scrutiny in the past. The company is currently embroiled in various lawsuits alleging illegal business practices, marketing its popular vaporizer-oil cartridges to youth, and selling hemp-based products containing excessive THC.
As New York continues to refine its cannabis regulations following the legalization of adult-use marijuana in March 2021, the investigation into Stiiizy serves as a reminder of the complexities and challenges facing the burgeoning industry. The outcome of this inquiry could have lasting repercussions not only for Stiiizy but for the broader cannabis landscape as New York works to ensure compliance and integrity within its legal framework.
With the cannabis market projected to thrive, the stakes are high for companies navigating the regulatory landscape. As this story unfolds, the industry watches closely to see how it will impact the operations of Stiiizy and other companies involved in the investigation.
