The BNN Report That Sealed The Fate Of Aceto

CannTrust Holdings Inc. (TRST.TO) Chief Executive Officer Peter Aceto told senior company officials to “continue as planned” and plant cannabis in an unlicensed room in mid-November, according to internal company documents obtained by BNN Bloomberg that establish a clear timeline of when illegal production was brought to management’s knowledge.

In minutes from weekly production meetings held by conference call from Nov. 14 to Nov. 28, seven CannTrust employees – including three vice-presidents as well as Graham Lee, the company’s director of quality and compliance – provided updates on developments at RG9, one of five unlicensed rooms at the company’s facility in Pelham, Ont. where Health Canada inspectors later determined the company grew thousands of kilograms of cannabis.

During a meeting held on Nov. 14, senior CannTrust staff stated that RG9 was not licensed by Health Canada and that further work in the room “needs up (sic) be run up the chain before anything is planted in there.” The room was estimated to be 50,000 square feet, roughly the same size as a football field, the minutes showed.

As well, Aceto – who was not present for any of the three production meetings – was to be informed by Lee that the RG9 room was not licensed, and that any repercussions if the company started planting in that room despite being unlicensed were “unknown.”

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That meeting also detailed how employee morale “seems to be unaffected” by corporate changes that led to the departure of president Brad Rogers as well as Michael Ravensdale, CannTrust’s former head of production, and that construction of additional rooms at the Pelham, Ont. facility was moving as planned.

“Doing what we can to make sure that deadlines are met and that [we are] holding people accountable,” the minutes showed.

On Nov. 21, the minutes stated that RG9 remained unlicensed but Lee – who attended each of the production meetings – stated he spoke to Aceto about the unlicensed room and was instructed to “continue as planned.”

Minutes from the Nov. 28 production meeting stated CannTrust employees had submitted an application to Health Canada for the RG9 licence and were still waiting for approval from the federal regulator. “Still moving forward with planting today – 3 lots,” the minutes stated. One lot is approximately 1,000 cannabis plants, which can produce as much as 1,000 kilograms of marijuana.

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A spokesperson for CannTrust declined to directly address BNN Bloomberg’s questions about the documents.

BNN Bloomberg obtained minutes from those three production meetings shortly after the head of CannTrust’s special committee said it was in the “final stages” of an investigation into how the company ran afoul of Health Canada regulations following an inspection last month that uncovered thousands of kilograms of cannabis grown in several unlicensed rooms at its Pelham, Ont.-based facility between last October and March.


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