A federal antitrust lawsuit filed Thursday by Michigan-based cannabis supplier Redbud Roots Inc. has ignited fresh scrutiny on the closed cannabis vaporizer market, accusing Shenzhen Smoore Technology Co. Ltd. and several U.S. distributors of conspiring to fix prices and lock out competitors in a scheme that allegedly choked off fair market access and manipulated wholesale prices.
The complaint, which seeks class action status for all direct purchasers of the vaping devices, paints a picture of secret meetings, coordinated pricing tactics, and aggressive legal warfare—all orchestrated to give Smoore, a dominant Chinese manufacturer, an iron grip on a lucrative slice of the U.S. vape industry.
A Web of Wholesale Collusion
Redbud Roots alleges that Smoore, together with Jupiter Research LLC, Greenlane Holdings LLC, 3Win Corp., and CB Solutions, coordinated what amounts to a cartel in the cannabis vape supply chain.
Though these companies are technically unaffiliated—and therefore, under law, should be competitors—the lawsuit claims they agreed to set minimum wholesale prices, exchange customer data, and report on those who “cheated” the scheme.
According to the lawsuit, this collusion was anything but passive. Redbud claims the parties held in-person meetings to reaffirm their pact, and that Smoore itself acted as ringleader, enforcing compliance with security deposits that could be forfeited by dissenters. In essence, the market was policed from within.
