Even before recreational cannabis became legal in California on Jan. 1, 2018, entrepreneurs eyeing future profits rushed into county offices to secure permits and licenses to get started growing. It was a bit of a free for all—Monterey County included—as local government officials struggled to handle the onslaught.
In the rush, some cannabis companies plunged ahead without all the necessary requirements in place. In the case of Battle Mountain Genetics, growing cannabis on Spence Road in Salinas, company officials didn’t have workers compensation insurance for 20 employees between Jan. 16, 2018, and April 30, 2018, according to a judgement filed in Monterey County Superior Court on June 10 by the state Labor Commissioner’s Office.
The company was ordered to pay a $35,196 penalty for failure to carry the insurance. The state used a formula calculating the weekly workers compensation insurance premium cost multiplied by the number of weeks Battle Mountain Genetics workers were uninsured.
The Labor Commissioner’s order was initially issued on Jan. 15. Company officials had until Jan. 30 to appeal, but did not, according to a state spokesperson. They also never paid the penalty, which was due 15 calendar days after the Jan. 15 order.
Battle Mountain Genetics filed as a business with the California Secretary of State’s Office in September 2016. It’s currently listed on the California Secretary of State’s website as suspended by the Franchise Tax Board for failure to meet tax requirements.
A month after Battle Mountain filed with the state, a Colorado company called Sunset Island Group, Inc., acquired the company in exchange for 50 million shares of stock, according to documents filed by Sunset Island with the Securities and Exchange Commission. The company reported that it operates through its wholly owned subsidiary VBF Brands.
The CEO/CFO of Sunset Island, Valerie Baugher did not return a message left at the company’s office in San Clemente.
In the SEC reports, Sunset Island details the space it leases in Salinas: 12,000 square feet of greenhouse space; 10,000 square feet of bare land that can be used for future greenhouse construction; approximately 2,000 square feet of nursery greenhouse space; and another 2,400 square feet for drying, manufacturing, trimming and distribution.