Aphria is not the only Canadian weed company with recent questions about such activities. High Hampton is (naturally) a CSE-listed company that is also on the OTC.
Stockwatch Street Wire: High Hampton ex Mann defends defamation claim
by Mike Caswell
High Hampton Holdings Corp.'s former chief operating officer, Paul Mann, denies that he defamed the company when he issued a news release that accused the company of "financial irregularities." He says that he had discovered many examples of what he calls illegal, dishonest or fraudulent activity on the part of High Hampton and its management. He claims to have reported his findings to the chief executive officer and others, but says that nobody did anything.
The denial from Mr. Mann comes in response to a lawsuit that High Hampton filed in the Supreme Court of British Columbia on Oct. 31, 2018. The company said that he was behind several communications, including a news release, that accused the company's chief financial officer and others of improprieties. Among other things, the news release questioned large payments that the company had made to entities that operated out of mailboxes. It also mentioned the non-compliant issuance of securities. High Hampton said that the accusations were false and defamatory, and sought appropriate damages.
For his part, Mr. Mann sees things much differently. In a response filed on Nov. 26, 2018, he explains that the news release came after he discovered activity that was reportable under a whistleblower policy that High Hampton had. The policy required employees to report any illegal activity by alerting their immediate supervisor or the company's human resources director.
As Mr. Mann explains, he found many things to report. These included unapproved payments by the company as well as payments without any apparent contract or scope of work. He also said he had discovered that somebody was concealing payments using irregular accounting practices. In addition, the company was issuing shares in a non-compliant manner, he contends.
Mr. Mann claims that he reported his findings to the company's CEO and to another board member, but nobody did anything. He then formally notified the company's human resources director and copied the company's CEO and chairman with his complaint, the response states. The company assembled an "independent committee" to investigate his complaint, but that committee included people who appeared to be behind the activity, Mr. Mann says. About two months later, the company fired Mr. Mann.
Mr. Mann admits that he was behind the news release in question, but denies that it was defamatory. He says that the information in the news release was true or substantially true. He also says that, as a former officer of High Hampton, he had an obligation to the company's shareholders to disclose the information. In legal terms, he says that he issued the news release on an occasion of qualified privilege.
In addition to denying the defamation allegations, Mr. Mann denies accusations from High Hampton that he took confidential data. (In the suit, High Hampton claimed that he made off with the names of clients and investors as well as their contact details.) Mr. Mann says that he never had access to that information. Any contact information he did receive was on a case-by-case basis.
Attached to Mr. Mann's response is a counterclaim against High Hampton, in which he is seeking damages over his firing. He claims that High Hampton fired him for no good reason. According to the counterclaim, the company had offered to dismiss him with full compensation, but only if he would sign an agreement that would prohibit him from disclosing the things that he had discovered. As he sees it, his employment agreement did not require him to sign any such agreement.
The counterclaim seeks damages based on Mr. Mann's annual salary of $140,000 (U.S.), among other things. Victoria lawyer Jarrett Plonka of Dominion GovLaw LLP filed the response and counterclaim on Mr. Mann's behalf.
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