Sugar-Free Pot Drink Investors Seek Final Nod on $1 Million Deal

India Globalization Capital Inc. investors who say the company misled them about plans for a sugar-free cannabis drink asked a federal judge in Maryland for final approval of their $1 million settlement.

The cash deal followed more than a year of negotiations and “represents the highest settlement amount that the Settlement Class could have achieved at the time,” the biopharmaceutical company’s investors said in a memo filed in support of their final settlement approval bid in the U.S. District Court for the District of Maryland.

The settlement class covers everyone who acquired IGC’s publicly traded common stock from Sept. 26, 2018, to and including Oct. 26, 2018, with exceptions for those with certain close ties to the company.

There’s a “real risk that IGC would be unable to pay a judgment or substantially larger settlement given its financial condition at the time” the parties reached a deal, according to the investor memo. It’s “all but certain” IGC couldn’t “satisfy a trial verdict for the full extent of damages in this case.”

If the investors continued litigating, IGC’s “remaining available insurance (less than $1 million) would be depleted by defense costs,” the Wednesday memo said.

Lead counsel Pomerantz LLP and the Rosen Law Firm PA in a separate Wednesday memo asked Judge Paul W. Grimm to sign off on 30% of the settlement fund—$300,000—in attorneys’ fees after previously indicating they would seek up to one third of the fund. The firms also want more than $54,000 as reimbursement for their litigation expenses.

PilieroMazza PLLC represents IGC.

The case is Tchatchou v. India Globalization Cap. Inc., D. Md., No. 8:18-cv-03396, final settlement approval motion filed 3/16/22.