Client Alert: Federal Court Refuses to Allow Lost Profits Claim from Alleged Breach of Cannabis-Related Contract
As a follow-up to our recent white paper discussing current issues in the commercial cannabis legal landscape (available for download), we write about a recent decision regarding the enforceability of contracts in federal courts as discussed in Section I(A) of the white paper.
On April 13, 2020, a federal court sitting in Oregon dismissed a cannabis grower’s lost profits claim arising out of a breach of construction contract. The court found that ordering defendants to pay lost profits would require defendants to violate the Controlled Substances Act (CSA). The plaintiff, J Lilly LLC, who has a license from the State of Oregon to grow commercial cannabis, entered into agreements with defendants for the purchase, construction and installation of a commercial greenhouse. J Lilly, a first-time grower, alleged that defects in the defendants’ construction of the greenhouse prevented plaintiff from growing its initial cannabis crop resulting in $5.4 million in lost profits.
To read the full article, please click here.
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© 2026 Jenner & Block LLP. Attorney Advertising. Jenner & Block LLP is an Illinois Limited Liability Partnership including professional corporations. This publication, presentation, or event is not intended to provide legal advice but to provide information on legal matters and/or firm news of interest to our clients and colleagues. Readers or attendees should seek specific legal advice before taking any action with respect to matters mentioned in this publication or at this event. The attorney responsible for this communication is Brent E. Kidwell, Jenner & Block LLP, 353 N. Clark Street, Chicago, IL 60654-3456. Prior results do not guarantee a similar outcome. Jenner & Block London LLP, an affiliate of Jenner & Block LLP, is a limited liability partnership established under the laws of the State of Delaware, USA and is authorised and regulated by the Solicitors Regulation Authority with SRA number 615729. Information regarding the data we collect and the rights you have over your data can be found in our Privacy Notice. For further inquiries, please contact dataprotection@jenner.com.
As a follow-up to our recent white paper discussing current issues in the commercial cannabis legal landscape (available for download), we write about a recent decision regarding the enforceability of contracts in federal courts as discussed in Section I(A) of the white paper.
On April 13, 2020, a federal court sitting in Oregon dismissed a cannabis grower’s lost profits claim arising out of a breach of construction contract. The court found that ordering defendants to pay lost profits would require defendants to violate the Controlled Substances Act (CSA). The plaintiff, J Lilly LLC, who has a license from the State of Oregon to grow commercial cannabis, entered into agreements with defendants for the purchase, construction and installation of a commercial greenhouse. J Lilly, a first-time grower, alleged that defects in the defendants’ construction of the greenhouse prevented plaintiff from growing its initial cannabis crop resulting in $5.4 million in lost profits.
To read the full article, please click here.
Related Articles
Related Capabilities
Related Locations
© 2026 Jenner & Block LLP. Attorney Advertising. Jenner & Block LLP is an Illinois Limited Liability Partnership including professional corporations. This publication, presentation, or event is not intended to provide legal advice but to provide information on legal matters and/or firm news of interest to our clients and colleagues. Readers or attendees should seek specific legal advice before taking any action with respect to matters mentioned in this publication or at this event. The attorney responsible for this communication is Brent E. Kidwell, Jenner & Block LLP, 353 N. Clark Street, Chicago, IL 60654-3456. Prior results do not guarantee a similar outcome. Jenner & Block London LLP, an affiliate of Jenner & Block LLP, is a limited liability partnership established under the laws of the State of Delaware, USA and is authorised and regulated by the Solicitors Regulation Authority with SRA number 615729. Information regarding the data we collect and the rights you have over your data can be found in our Privacy Notice. For further inquiries, please contact dataprotection@jenner.com.
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