Editor’s note: This is the second installment in a two-part series. Read the first part here.
HONEYDEW — Within a year of starting up Pacific Expeditors cannabis distribution company, CEO Chris Coulombe’s drivers were heading into the mountains in $100,000 armored vans to pick up the harvest from former outlaws.
Coulombe and his team had contracts with about 50 farmers from the famed “Emerald Triangle” — a remote cannabis-growing hub made up of Humboldt, Trinity and Mendocino counties — to distribute their marijuana to dispensaries statewide.
Drew Barber, who owns and operates a farm along the Lost Coast and is a member of a farmers cooperative called Uplift, signed on with Pacific Expeditors when company representatives told him they would get his farm a booth at the 2018 Emerald Cup, one of the premier networking opportunities in the Northern California legal cannabis world.
Six months after the cup, Barber said, his farm still had not been paid for their pot sales at the event or for other cannabis he provided to Pacific Expeditors. His questions mounted even as some small payments trickled in.
“We only got 600 to 800 bucks and 30 pounds of weed disappeared,” Barber said. “All our weed, jars, labels … everything.”
Gary and LaDonna Haga too, were worrying. They had provided Pacific Expeditors as much as 200 pounds, they said, of “Grade A bud.”
Sales invoices they provided to The Press Democrat indicate the pot went to dispensary shelves. But they received little money in return.
The product certainly seemed to be moving.
On Aug. 13, 2019, Pacific Expeditors Vice President of Business Development Ben Sims emailed the Hagas. “We are currently sold out of your (eighths and half ounces). When do you think the next batch can be ready for pick up?” he wrote.
Two months later, on Oct. 29, Sims wrote again. “What is the cross used to create your chocolate explosion strain? If a club buys 500 of those (rolled joints) can we offer a discount? It’s the only strain we have much left of.”
The Hagas said they were never paid for a single joint. They provided Pacific Expeditors new shipments though they hadn’t been paid for previous ones. “We were slow to the draw,” LaDonna Haga said. “We’re country folks. We didn’t jump to conclusions.”
But other farmers were asking questions.
“I fielded phone calls all the time from growers asking for their money,” said Brian Gillespie, a former Pacific Expeditors operations manager.
The invoices the Hagas provided The Press Democrat hint at upstream issues. In sheets documenting a little less than two months of sales data, from September 2019 to November 2019, the columns for sums “paid” are riddled with zeroes.
“They told a lot of our people, repeatedly, ‘We’re going to move your weed, we’re going to professionalize it,’” said Natalynne DeLapp, executive director of the Humboldt County Growers Alliance, which represents craft farmers in the area.
“For a while that’s what they did. And then all of a sudden that’s not what they’re doing.”
Not all farmers were shorted. David Silverstone is a grower in the Redwood Valley outside Ukiah with a 2006 felony as testament to his bona fides as a “legacy” operator. He said Pacific Expeditors always paid its debts to him, and he was impressed with their efforts to get his cannabis into dispensaries.
“I was in more stores than I’ve ever been,” with them, he said. Pacific Expeditors put his cannabis into 15 dispensaries or more, he said, while today he is only selling in two.
“I wish (Pacific Expeditors) had stuck around and taken over, really,” he said.
But Coulombe and his backers, drawn in by promises of a lucrative industry that never materialized, would never see those profits — and they weren’t alone.
“Every business in this whole industry is failing,” Silverstone said. “It's failing. We're all failing.”
Chains of debt
Pacific Expeditors wasn’t paying farmers because the retailers — dispensaries — were not paying the distributor, Coulombe said. The company shut down with more than $500,000 in unpaid debt from retailers, only 15% of which was the distributors’ cut, he said. The rest should have gone to farmers.