Class Actions Are A Growing Risk For CBD Cos.

By Christopher Binns (February 13, 2020, 4:20 PM EST) -- The U.S. Food and Drug Administration and the Federal Trade Commission issued warning letters to various CBD manufacturers in 2019 alleging a number of violations, including unsubstantiated advertising claims, and marketing and selling unapproved new drugs and unapproved dietary supplements. Since the warning letters were issued, CBD companies are being hit with an increasing number of class actions.

While a few lawsuits were filed against CBD companies prior to the regulators' warning letters — from shareholder derivative suits to allegations of CBD products impermissibly containing THC, resulting in a failed drug test — the class actions filed after the October and...

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