Colorado AG Fines Cannabis Company for Violating Prior Settlement | Cannabis Law Report | How to order Skittles Moonrock online

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On January 5, 2026, Colorado Attorney General (AG) Phil Weiser announced that MC Global Holdings and affiliated persons and entities (collectively, MC) had been fined for allegedly violating the terms of a May 2025 assurance of discontinuance. The defendants, who are engaged in manufacturing, packaging, labeling, distributing, and/or selling industrial hemp products under the brand Vivimu, agreed to a fine of $575,000, of which $500,000 will be suspended as long as they comply with the terms of the new agreement.

The May 2025 assurance of discontinuance (see our coverage here) addressed allegations that MC falsely represented, in violation of the Colorado Consumer Protection Act (CCPA), that certain of its products were derived from “organic” hemp flower, that MC was involved in the production of products that really came from third-party suppliers, and that MC operated from Texas when in fact it was operating out of Colorado. The AG also alleged that the company was improperly testing certain products at laboratories that had not been certified by Colorado authorities.

In addition to a monetary penalty of $250,000 (of which $200,000 was suspended), injunctive terms in the May 2025 settlement included requirements that MC comply with the CCPA, remove false or misleading statements from its advertising and product descriptions, and add a conspicuous disclaimer on all products stating: “No sales in Colorado.”

Despite those commitments, state investigators concluded within four weeks of the assurance of discontinuance that the company was not fully complying with its terms. According to the AG’s office, investigators found that MC was unlawfully advertising marijuana extract to Colorado consumers via email, falsely representing on its website that its products were prohibited in certain Colorado cities rather than statewide, continuing to misrepresent on a website that the company was based in Texas, and continuing to rely on unauthorized laboratories for product testing.

In the new assurance of discontinuance based on these alleged violations, MC recommits to complying with the injunctive terms from the first settlement as well as additional requirements meant to deter evasion of the injunction. Specifically, one of the individual defendants is obligated to report any change of residence, and the defendants are expressly prohibited from using third parties or changes to business names or classifications to violate the terms of the settlement.

In the event MC materially violates this second assurance of discontinuance, the AG will be entitled to a judgment in the amount of $500,000 (reflecting the suspended penalties) plus any outstanding portion of the remaining $75,000 penalty and to conversion of the assurance of discontinuance into a permanent injunction.

Why It Matters

Colorado’s settlement with MC has significance beyond the cannabis industry. For companies in any regulated industry, this matter underscores the importance of robust compliance programs, regular legal review of marketing materials, and careful adherence to the terms of any settlements with regulators.

Settlement agreements are not the end of the story. Here, the AG’s office monitored the company’s conduct in the weeks after a settlement and almost immediately identified alleged violations, which led it to impose penalties that more than doubled the original fine. Compliance must be ongoing and operationalized. It is not enough to sign a settlement agreement and make one-time changes. Companies need internal controls to ensure marketing, labeling, and online content remain compliant over time, and that affiliates and vendors also conform their conduct to the agreement if necessary.

For cannabis companies in particular, this settlement reflects that regulators in states with mature adult-use markets are increasingly focused on protecting consumers and companies that play by the rules. Health and quality claims are particularly sensitive. Cannabis companies should avoid unsubstantiated or exaggerated claims about medical benefits, “all natural” or “organic” content, or product quality unless those statements are backed by evidence and consistent with legal requirements.

Our Cannabis Practice provides advice on issues related to applicable federal and state law. Cannabis remains an illegal controlled substance under federal law.