Lawsuit in the land of legal marijuana

MED-a-mints maker disputes Dixie Elixirs’ efforts at re-branding


In September of 2012, when Gary Gabrel was introduced to the owner and founder of Dixie Elixirs, it looked to be a good match for a venture into the vastly uncharted world of marijuana sales.

Tripp Keber, Dixie’s founder and CEO, represented one of the nation’s hippest and, it would turn out, media savvy marijuana edibles companies.

And Gabrel, who made millions of dollars in a range of businesses — from board games to pizza restaurants — was pedaling a special formula of edible marijuana called MED-a-mints, combining a “good high,” as Gabrel claims, with a reliable dose.

“And just like Coca-Cola,” Gabrel says, “what goes into our mixture is a secret.”

The deal was for Gabrel’s company to provide the “premium” cannabis to Dixie, which would package and distribute the mints to pot shops around Colorado. The marriage of the two companies seemed to be going well as Dixie emerged as one of the most familiar names in the business. Keber seemed to be everywhere — from Rolling Stone to 60 Minutes’ segment on marijuana, “Rocky Mountain High.” But behind the spotlight, trouble was brewing between Dixie and Gabrel. The problem? Dixie, Gabrel says, turned his MED-a-mints into a “slick, sexy-looking product.” While Gabrel has no qualms with that approach in itself — “slick and sexy sells,” he admits — the focus on safety and consumer warning seemed to fall a bit to the wayside.

“Our old label may have looked pedestrian — maybe a little too pedestrian for them,” he adds, “but it was responsible.”

So Gabrel and Dixie have parted ways. And now Gabrel is taking Dixie to court in what may be the pot industry’s first legal trademark dispute.

The suit, which Dixie’s chief of marketing is calling “frivolous,” was filed in Denver District Court last week on behalf of Gabrel’s company, Bridge Marketing. It alleges that Dixie put image over concerns for consumer information. But the controversy is highly nuanced, largely centering on the tin box that contain the mints.

The “packaging does almost nothing to inform consumers that the product actually contains marijuana infused mints,” the suit alleges. “The only information on the container concerning its contents are the initials ‘THC.’ There is no other information to warn consumers of the presence of cannabis. Rather, the packaging is suggestive of any other designer mint that consumers would purchase at Whole Foods or Starbucks.”

Dixie’s efforts, Gabrel adds in an interview, made his MED-a-mints “look like candy for children.”

That characterization, Dixie Chief of Marketing Joe Hodas says, is “absolutely ridiculous.” Dixie takes safety “very seriously,” Hodas adds, and the packaging of MED-a-mints is clearly labeled and styled to appeal to adults.

The conflict over the tin boxes that hold the mints comes as edibles have sparked disturbing headlines in recent weeks, including stories of two deaths.

In Denver, Levy Thamba, a 19-year-old Northwest College student visiting from Wyoming, plunged to the ground from a hotel balcony. The coroner in the case found that Thamba had consumed cookies infused with cannabis and that “marijuana intoxication” was a significant factor in his death, classified as an accident. In another case, which has made headlines around the globe, prosecutors have filed one charge of first-degree murder against Richard Kirk in the shooting death of his wife, Kristine A. Kirk, according to a statement by the Denver District Attorney’s Office. Kirk reportedly purchased marijuana edibles before the shooting and appeared intoxicated after being taken into custody.

The two cases are among the most serious on a growing list of problematic incidents in which high doses of marijuana were a likely factor. And that’s fueled debate about the subject at the Colorado Legislature, where lawmakers seem to be on the constant lookout for how to regulate edibles. Earlier this week, for example, House Bill 1366 passed the full House. If the bill becomes a law, edible retail marijuana products would need to be “shaped, stamped, colored or otherwise marked” so that they don’t mimic products that already exist.

Belying such efforts are concerns that consumers and kids can mistake edibles for candy or cookies.

“As industry leaders, we should be showing the way, rather than being forced to do the right thing by the government,” Gabrel says. “In my opinion, MED-a-mints is the safest brand and label on the market right now. I want to see them offered in childproof pill bottles, as well as tins.”

For Gabrel, the tins Dixie designed didn’t do enough to warn of safety and health risks that could be associated with the consumption of MED-amints. The back of MED-a-mints’ original tin box had an extensive warning.

The back of the new tin box by Dixie is blank while the front states that the mints contain 100 mg of THC.

But Hodas says Dixie “went above and beyond” what’s needed, placing a warning on the back of a cardboard card to which the tin cans are attached.

“There may be health risks associated with the consumption of this product,” the Dixie cardboard backer label states. “This product is unlawful outside the State of Colorado. This product is infused with marijuana.”

The cardboard backer adds that the mints are not regulated for safety and health and that they may be health risks for women who are pregnant and that people should not drive or operate heavy machinery while under the influence of marijuana.

“What is of utmost relevance,” Hodas adds in an email, “is the amount of content that we are required to include with our mint packaging — which also has to be legible.”

In other words, Hodas says Dixie is providing more information to consumers by using the cardboard card, not less.

But that’s moot to Gabrel. He says people will detach the card after buying the mints and simply throw it away, and have only the tin to inform them.

He adds that Dixie’s changes to the packaging of his product were “unilateral,” a charge that Hodas also vehemently denies. Hodas says Gabrel was involved in email approvals of the product.

With Gabrel also alleging “nonpayment of royalty fees,” that leaves Dixie preparing to defend itself in court, as well as exploring other legal remedies. Gabrel, meanwhile, says he is seeking a new business partner.