Lawsuit claims cannabis companies intentionally made false claims about medical benefits

A class-action federal lawsuit was filed Monday against three national Chicago-based cannabis companies, claiming they’re causing "tragedy and human misery" by making false claims about the medical effects of their products, and downplaying their dangers.

The suit was filed on behalf of 42 customers in a dozen states against Cresco Labs Inc., Green Thumb Industries Inc. and Verano Holdings Corp. A similar suit was filed in state court in downstate Marion County, and in Connecticut against another cannabis multistate operator, Curaleaf Holdings Inc.

The litigation was filed by, among other attorneys, former McHenry County State's Attorney Patrick Kenneally, who as prosecutor in 2023 demanded that cannabis dispensaries in his county post warnings about the potential harms of cannabis or face consumer fraud lawsuits. He is now in private practice for Burke Law Group in Chicago.

The new suit claims that the companies knew or should have known about the hazards of their products and lack of evidence for medical benefit, and should have better warned consumers. The suit seeks class certification for anyone who bought cannabis products in recent years from those companies.

The action seeks disgorgement of "all monies wrongfully obtained" by the cannabis companies, restitution to their customers, a prohibition on false medical claims and requiring defendants to warn customers about their products' dangers to mental and physical health. The suit alleges that customers overpaid due to the misleading claims, but does not cite any personal injuries, for which suits typically are filed individually.

In response, Verano issued the following statement: "This lawsuit is part of a broader litigation campaign that plaintiffs' counsel has brought against several multi-state cannabis operators, and mirrors claims that have been rejected by courts in similar legal actions against multi-state operators in the industry earlier this year. Verano operates in compliance with applicable state laws and regulations, including the detailed product labeling, testing, and warning requirements dictated by each state in which Verano is licensed.

“The medical use and benefits of cannabis have also long been recognized by the states themselves, as reflected in the comprehensive medical marijuana programs that state legislatures and regulators have established and overseen for years. More recently, the federal government - through both the President's December 2025 Executive Order and the Department of Justice's April 2026 rescheduling order - has likewise formally recognized the accepted medical use of cannabis. We strongly disagree with the allegations and intend to defend the matter vigorously."

A Cresco official said the company doesn't comment on litigation. Cannabis advocates have long argued that while studies of cannabis to treat medical conditions are encouraging, more research is needed, while some in the medical community have resisted its use.

But the suit charges that cannabis companies have made widespread fraudulent claims online and through salespeople. One study found that 67% of dispensary websites made health claims.

"Cannabis purveyors market and promote their cannabis products to an unsuspecting public through a public relations megaphone as the antidote to ailments of all kinds …" the suit states.

Evidence has shown cannabis to be effective in treating seizures, loss of appetite from chemotherapy and AIDS, and muscle spasticity in multiple sclerosis.

But in 2025, the Journal of the American Medical Association published an analysis of 124 studies that found, “Evidence is insufficient for the use of cannabis or cannabinoids for most medical indications.”

To make matters worse, daily inhaled cannabis use was associated with an increased risk of coronary heart disease, heart attack, stroke and cannabis-use disorder.

The American Psychiatric Association also stated that there is "insufficient evidence" that cannabis is effective for any psychiatric disorder.

"Perhaps the most alarming health risk" associated with marijuana, the suit states, is its association with mental health disorders such as schizophrenia and psychosis.

The 317-page suit goes so far as to accuse the companies of working together through trade groups in a "conspiracy" to operate an illegal and fraudulent industry.

The lawsuit comes as the federal government is acting to reschedule marijuana from Schedule I to Schedule III under the Controlled Substances Act. That would acknowledge it has medical value, would allow for more medical research and would allow cannabis companies to take business tax deductions. It could eventually open the door to doctors giving prescriptions for cannabis, but that would require products to be approved by the U.S. Food and Drug Administration.

So for now, though 24 states, including Illinois, have legalized recreational cannabis, and 40 states allow some form of medical cannabis, it remains illegal under federal law, leaving the industry in a potentially vulnerable legal position.

The FDA has approved synthetic THC to treat nausea from chemotherapy and appetite loss from AIDS, and another cannabinoid, CBD, to treat severe epilepsy.

Further complicating matters, Congress voted to legalize hemp in 2018, which led to an explosion of unlicensed hemp shops selling intoxicating cannabis products like delta-8 THC. After widespread reports of untested or falsely labeled products being sold to minors and others, federal lawmakers acted to generally prohibit intoxicating hemp products, effective in November.

Amid the controversy over pot's efficacy, Illinois has approved 56 medical conditions for cannabis use, from Alzheimer's to uterine fibroids, based largely on anecdotal evidence and testimony from patients.

Illinois law requires that cannabis products warn that smoking is hazardous, and "Its use can impair cognition and may be habit forming. This product should not be used by pregnant or breastfeeding women."

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This story was originally published May 5, 2026 at 11:54 AM.