A court has now rejected the claim that High Park/Tilray’s acquisition of claims was a collateral attack or an abuse of process in restructuring 420 Investments Ltd. and its associated entities under the Companies’ Creditors Arrangement Act (CCAA).

High Park/Tilray was not disallowed from voting on the proposed plan. In addition, the CCAA has been amended to include all unsecured creditors, and the stay of proceedings was again extended, this time to June 30, 2025.

The court rejected 420’s claim that High Park/Tilray’s actions were a collateral attack on an earlier decision from the court, clarifying that the prior ruling only restricted High Park’s voting rights in relation to a bridge loan, not other claims.

The parent companies of cannabis retail chain Four20 Premium Markets first filed a notice of intent to make a proposal under the Bankruptcy and Insolvency Act on May 29, 2024.

The companies Four20 Premium Markets Ltd., 420 Investments Ltd., and Green Rock Cannabis Ltd (GRC) (collectively “420 Parent”), filed the notices of intent following a $9.8 million judgment against 420 for repayment of a bridge loan and related interest and costs to Tilray subsidiary High Park Shops Inc. High Park was created for the purpose of the acquisition of Four20.

Tilray had initiated litigation against 420 after a failed attempt by Tilray to purchase 420 for approximately $110 million in 2019.

The applicants, 420 and its associated entities, argued that High Park/Tilray’s acquisition of claims was an improper attempt to block the restructuring plan, contrary to the purpose of the CCAA, alleging that this conduct was prejudicial to other creditors with a goal of preventing High Park/Tilray from voting.

You can read more about the background of the process here.