Michigan, Massachusetts, Missouri, Nevada and New York reveal unreliable laboratory results, falsified testing data, contaminated products, false tracking records and unregulated marijuana entering licensed commerce
WASHINGTON, D.C. / ACCESS Newswire / August 19, 2026 / MMJ International Holdings, Inc. ("MMJ") today released Part Two of its investigation into the factual premise underlying Attorney General Order No. 6754-2026: that state medical-marijuana systems possess a "sustained capacity" to prevent diversion, protect consumers, maintain reliable records and perform functions ordinarily required by federal controlled-substance regulation.
Part Two examines Michigan, Massachusetts, Missouri, Nevada and New York.
The records expose the central weakness in the Attorney General's conclusion: DOJ appears to have confused the existence of a regulatory system with proof that the system works.
A state may issue licenses, require laboratory testing, mandate seed-to-sale tracking and conduct inspections. But those requirements provide meaningful protection only when the information is truthful, the laboratories are reliable, regulators can detect misconduct promptly and illegal marijuana cannot enter or leave the licensed supply chain unnoticed.
The states' own records show that none of those conditions can simply be presumed.
"Massachusetts suspended a licensed laboratory after investigating falsified test results involving hundreds of failed microbial samples," said Duane Boise, Chief Executive Officer of MMJ International Holdings, Inc. "Michigan found inaccurate or unreliable laboratory results. Missouri found unregulated cannabis inserted into licensed commerce using false tracking data. Nevada documented testing practices aimed at producing desired results. Federal prosecutors in New York alleged that a massive illegal grow supplied state-authorized facilities. The Attorney General called these systems robust. The public deserves to know what evidence he reviewed before reaching that conclusion."
A LICENSE CAN CREATE THE APPEARANCE OF CONTROL
Traditional diversion occurs when marijuana leaves an authorized channel and enters illegal commerce.
Inversion presents the opposite danger: illegally cultivated, contaminated, untested or otherwise unregulated marijuana enters a licensed system and acquires the appearance of legitimacy through tracking records, laboratory certificates, packaging or transfers between licensees.
That distinction matters because a regulatory system can look orderly while its underlying information is false.
A seed-to-sale database tracks what licensees enter into it. It does not independently determine whether the marijuana actually came from the source identified in the database.
A laboratory certificate reports a result. It does not prove that the sample was representative, the testing procedure was followed or the result was reported truthfully.
A state license identifies who received state authorization. It does not establish the lawful origin, chemical composition, contamination status or regulatory history of every product the licensee handles.
The Attorney General's order nevertheless gave state credentials extraordinary federal significance. It established expedited DEA registration, accepted state records to the maximum extent permitted and allowed qualifying applicants to continue state-authorized operations while their federal applications remained pending.
That preferential treatment depends on the premise that the state systems and the records they produce can be trusted.
The enforcement record says that trust must be earned and independently verified.
MICHIGAN: THE LABORATORY GATEKEEPER FAILED
Testing laboratories are the gatekeepers of a regulated marijuana market. Their results determine whether products fail, whether they reach store shelves and how their potency and safety are represented to consumers.
In Michigan, the gatekeeper failed.
In August 2025, Michigan's Cannabis Regulatory Agency announced a settlement ending years of disciplinary proceedings and litigation involving Viridis Laboratories and Viridis North, two state-licensed safety-compliance facilities.
The settlement immediately revoked Viridis's Lansing licenses, required its Bay City facility to close and permanently excluded the laboratories' three majority owners from Michigan's marijuana industry.
According to the CRA, Viridis admitted all regulatory violations alleged in six administrative complaints. The agency said it uncovered evidence that the laboratories failed to follow approved testing procedures in several respects, producing inaccurate or unreliable results.
"This wasn't just a single misstep," CRA Executive Director Brian Hanna stated. "It was a sustained, deliberate pattern of noncompliance that shook confidence in the entire regulated cannabis system."
The CRA's reference-laboratory director described scientific integrity as "the foundation of the cannabis industry."
Michigan's action demonstrates why a laboratory license cannot be treated as proof of laboratory reliability.
The facilities were licensed. The products were being tested. The regulatory framework existed.
The results were still inaccurate or unreliable.
That is more than the failure of one company. It demonstrates the vulnerability of a system in which a private laboratory's data can determine whether substantial quantities of marijuana enter consumer commerce.
The federal government should explain whether it examined cases like Viridis before concluding that state systems could reliably perform federal product-safety and recordkeeping functions.
MASSACHUSETTS: PRODUCTS PASSED-THEN REGULATORS DISCOVERED THE TEST RESULTS COULD NOT BE TRUSTED
Massachusetts provides one of the clearest examples of contaminated marijuana receiving the appearance of regulatory approval before state officials discovered that the underlying laboratory results were unreliable.
In February 2025, the Massachusetts Cannabis Control Commission issued a public-health advisory concerning marijuana flower and pre-rolls that had previously passed required compliance testing.
According to the Commission, additional testing later detected yeast, mold and coliforms above permitted limits. Some of the affected products had been sold between May 31, 2024, and January 23, 2025.
Consumers and medical-marijuana patients were advised to destroy the products or return them to the retailers where they were purchased.
That incident alone presented a serious regulatory question: How did marijuana exceeding state contamination limits receive passing compliance results and reach consumers?
Several months later, the problem became substantially more serious.
On June 30, 2025, the Commission summarily suspended the license of Assured Testing Laboratories following a monthslong investigation into what the agency subsequently described as "falsified test results."
The Commission identified 544 laboratory samples that had failed total yeast-and-mold testing. The affected marijuana had been tested between April 1, 2024, and April 15, 2025.
On August 6, 2025, regulators issued another public-health and safety advisory covering contaminated and potentially contaminated marijuana associated with those results.
The Commission took steps through Metrc, the state's third-party seed-to-sale tracking system, to prevent further sales. It advised consumers to destroy affected products or return them to the licensees where they were purchased.
The Commission did not characterize the advisory as a mandatory statewide recall. Instead, it directed licensees to follow their established recall procedures where applicable.
That technical distinction does not make the underlying failure less significant. It makes the timing more troubling.
Marijuana received passing laboratory documentation, entered the licensed supply chain and was available to consumers before regulators determined that hundreds of samples had actually failed microbial testing.
The laboratory later entered into a stipulated agreement that included a $300,000 fine and substantial changes to its personnel, policies and operations.
The Commission's enforcement ultimately stopped additional sales. But stopping sales after inaccurate information has moved through the market is not the same as preventing the failure.
Massachusetts's experience exposes the weakness in treating a state laboratory certificate as conclusive evidence of product safety.
The laboratory was licensed.
The marijuana was tracked.
Compliance results were reported.
Products entered commerce.
The data were still unreliable.
"Massachusetts did not discover a minor paperwork deficiency," Boise said. "The state identified hundreds of failed microbial samples after products had received the appearance of laboratory approval. When the laboratory result is false, the tracking system does not protect the consumer. It distributes the false result throughout the licensed market."
Massachusetts had already received a warning about broader oversight deficiencies.
A September 2023 performance audit by the Massachusetts Office of the State Auditor found that the Cannabis Control Commission did not identify all marijuana products considered expired and did not prevent their sale before retesting.
The audit also found that the Commission did not ensure that marijuana establishments and independent testing laboratories properly reported positive pesticide tests within the required period.
The 2023 audit and the 2025 laboratory investigation reveal the same institutional problem: written requirements do not establish verified compliance.
Sources: Massachusetts Cannabis Control Commission, February 3, 2025 public-health advisory; August 6, 2025 advisory concerning Assured Testing Laboratories; Commission enforcement-action records; and Massachusetts Office of the State Auditor, September 26, 2023.
MISSOURI: FALSE TRACKING DATA GAVE UNREGULATED CANNABIS THE APPEARANCE OF LEGITIMACY
Missouri presents the clearest documented example of inversion.
In November 2023, Missouri's Division of Cannabis Regulation revoked the manufacturing license of Delta Extraction, LLC.
According to the Division, Delta admitted sourcing THC-A material outside Missouri's regulated marijuana program, converting it into THC and selling products containing that THC through the licensed market.
The Division found that Delta:
Failed to obtain marijuana from a Missouri-licensed cultivation facility;
Used THC originating outside the regulated marijuana program;
Entered false information into the state's seed-to-sale tracking system;
Failed to maintain product traceability;
Violated testing requirements;
Used false or misleading product information; and
Failed to comply with security requirements.
Missouri initially recalled affected products in August 2023.
In February 2025, the Missouri Administrative Hearing Commission found grounds for the recall because Delta used unregulated cannabis in its distillate.
In April 2025, regulators expanded the recall after discovering additional products containing THC oil derived from unregulated cannabis.
No adverse reactions had been reported to the state when the updated recall was announced.
The absence of reported injuries does not erase the regulatory failure. Unregulated cannabis entered a licensed system, and false data gave it a state-sanctioned appearance of traceability.
That is precisely what electronic tracking was supposed to prevent.
"Missouri destroys the argument that an entry in a tracking system proves lawful origin," Boise said. "The system tracked what it was told to track. The information was false. The cannabis was unregulated. Yet the products moved through licensed commerce until regulators discovered the truth."
Missouri's findings demonstrate that seed-to-sale technology is an accounting tool-not an independent verification system. If the source information is false, the database can preserve and distribute the falsehood with digital precision.
Sources: Missouri Division of Cannabis Regulation license-revocation announcement and April 10, 2025 updated recall notice.
NEVADA: A LICENSED LABORATORY WAS TESTING FOR DESIRED RESULTS, NOT ACCURACY
Nevada's administrative record exposes another weakness: laboratory procedures can be manipulated to obtain commercially favorable results.
During a February 2023 Cannabis Compliance Board proceeding involving Lettucetest, LLC, state counsel described findings concerning unauthorized retesting, potency testing, pesticide procedures and failures to follow required quality-assurance and quality-control programs.
The hearing officer found, among other things, that the laboratory used unauthorized retesting practices and failed to act impartially and objectively in testing for certain clients.
The Board's minutes state that evidence showed the laboratory did not separately charge for retests, indicating that testing for desired results was integrated into the services provided, and that clients financially benefited.
The hearing officer also addressed practices involving trend logs, communications with clients before reporting results and failures to take corrective action when testing equipment exceeded tolerance limits.
The licensee disputed numerous allegations and aspects of the proceeding. Those disputes should not be erased.
Neither should the administrative findings.
Nevada's regulator summarized the controlling principle directly: laboratory testing should seek accuracy-not results designed to satisfy customers.
Nevada regulators have separately investigated dispensaries for selling products that reportedly failed microbial testing and have pursued more detailed requirements governing sampling, chain of custody, tracking identification, remediated batches, failed-sample retention and certificates of analysis.
Those reforms may strengthen the system. Their necessity also reveals what the earlier system failed to prevent.
A laboratory certificate is not self-validating. If sampling, testing or retesting can be manipulated, the certificate may give questionable marijuana the appearance of scientific legitimacy.
Source: Nevada Cannabis Compliance Board, February 15, 2023 meeting minutes.
NEW YORK: A MASSIVE ILLEGAL GROW ALLEGEDLY SUPPLIED STATE-AUTHORIZED FACILITIES
New York presents the question in its most direct form: What happens when allegedly illegal marijuana moves toward state-authorized businesses?
In May 2025, federal investigators executed a search warrant at a property in Walworth, New York. Authorities reported seizing approximately 29,406 marijuana plants and 3,700 pounds of processed marijuana.
Federal prosecutors charged two men with operating a large-scale illegal cultivation operation.
According to the criminal complaint, marijuana from the operation was sold and distributed to multiple New York State-authorized cannabis grow facilities.
Federal authorities stated that neither the source company nor associated businesses held a valid New York license to cultivate cannabis.
The defendants have been charged, not convicted, and are presumed innocent unless proven guilty. The government's announcement also does not establish that any receiving facility knew the alleged source was unlawful.
But the allegations expose a question the Attorney General's order does not answer: What did the state system do to verify the marijuana's origin?
If state-authorized facilities allegedly received marijuana connected to an unlicensed source, the relevant federal question is not limited to whether the recipients knowingly violated the law.
The question is whether the regulatory system detected the alleged transfers before federal agents seized tens of thousands of plants and thousands of pounds of processed marijuana.
The New York case does not prove every allegation. It shows why state authorization cannot be accepted as conclusive evidence of effective supply-chain control.
Source: U.S. Attorney's Office for the Western District of New York, May 15, 2025.
THE SYSTEM "WORKED"-AFTER THE PRODUCTS, DATA AND CONDUCT HAD ALREADY MOVED THROUGH IT
State regulators may respond that these enforcement actions prove their systems worked.
That argument deserves only partial credit.
Enforcement matters. Recalls, advisories, license revocations and criminal investigations can remove bad actors and improve future compliance.
But after-the-fact enforcement is not the same as sustained prevention.
Michigan acted after inaccurate or unreliable laboratory results had been produced.
Massachusetts acted after contaminated products had received passing results and after hundreds of failed microbial samples had been identified.
Missouri acted after unregulated THC entered licensed commerce through false tracking data.
Nevada confronted laboratory practices after unauthorized testing and retesting procedures had already been used.
Federal agents in New York acted after an alleged illegal operation reportedly cultivated tens of thousands of plants and distributed marijuana toward state-authorized facilities.
The question is not whether regulators eventually reacted.
The question is whether these systems possessed the preventive capacity DOJ attributed to them before granting state licensees preferential federal treatment.
THE SAME FAILURE POINTS APPEAR ACROSS DIFFERENT STATES
The records do not reveal one isolated defect. They reveal recurring vulnerabilities:
Unregulated marijuana can enter licensed commerce;
Marijuana can leave licensed channels for illegal markets;
Source information can be falsified;
Tracking systems can preserve false information without detecting it;
Laboratories can falsify or generate inaccurate results;
Contaminated products can receive passing compliance results;
Testing procedures can be manipulated or improperly repeated;
Regulators can fail to identify expired inventory;
Positive pesticide results can go unreported;
State-authorized facilities can allegedly receive marijuana from unlawful sources; and
Enforcement may occur only after products have already moved through the market.
These are not hypothetical weaknesses imagined by opponents of marijuana reform.
They come from state auditors, state cannabis regulators, administrative proceedings, DEA investigations and federal prosecutors.
DOJ'S CONCLUSION NOW REQUIRES AN EXPLANATION
Attorney General Order No. 6754-2026 states that qualifying state regimes developed "robust infrastructure for preventing diversion, ensuring product safety, maintaining records, and conducting facility inspections."
The order further found that state systems, "taken as a whole," demonstrated "a sustained capacity" to prevent controlled substances from entering illicit channels.
Yet the published order does not identify:
Which states were evaluated;
What performance measures were applied;
What failure rates were considered acceptable;
Which audits, recalls and enforcement actions were reviewed;
Whether laboratory-integrity problems were examined;
Whether DOJ tested the reliability of seed-to-sale information;
How DOJ evaluated inversion;
What independent federal verification will occur; or
What minimum safeguards a state must maintain to remain eligible.
The order announces confidence without disclosing the evidentiary basis for that confidence.
That omission is especially significant because DEA's own 2025 National Drug Threat Assessment warned that Chinese transnational criminal organizations dominate domestic marijuana cultivation and distribution, with most grow sites located in states where cannabis is legal.
The public record does not establish whether Acting Attorney General Todd Blanche reviewed that assessment, HIDTA intelligence or the individual state enforcement records before signing the order.
MMJ is not claiming that Blanche knowingly ignored a particular report.
MMJ is asking DOJ to identify what he reviewed.
If the Department considered the contrary evidence and found the state systems reliable despite it, DOJ should publish that analysis.
If the Department did not consider the evidence, its conclusion was built on an incomplete record.
MMJ FACED FEDERAL SCRUTINY; STATE OPERATORS RECEIVED FEDERAL DEFERENCE
The disparity with MMJ's federal application makes the issue concrete.
MMJ BioPharma Cultivation applied to DEA in December 2018 for registration to manufacture cannabis active pharmaceutical ingredient for federally authorized pharmaceutical research and development.
DEA subjected MMJ to a pre-registration investigation, facility inspections, security and recordkeeping review, an Order to Show Cause and administrative litigation.
More than seven years later, the application remains unresolved.
MMJ has spent more than eight years and more than $10 million developing standardized cannabinoid pharmaceutical candidates through FDA and DEA pathways.
The company developed a finished dosage form containing 5 milligrams of CBD and 2.5 milligrams of THC per soft-gel capsule. Thousands of soft gel capsules were manufactured by Catalent Pharma Solutions.
MMJ holds two Investigational New Drug files with FDA and received Orphan Drug Designation for its Huntington's disease program.
Its products remain investigational and subject to Full Clinical Hold.
MMJ does not cite that history to ask for reduced scrutiny. It cites that history to ask why comparable scrutiny disappeared when the applicant possessed a state marijuana license.
"MMJ was required to prove its controls directly to the federal government," Boise said. "The new order allows state operators to rely on credentials issued by systems that government records show can be penetrated, manipulated or circumvented. We are not asking DEA to lower the standard for MMJ. We are asking why DOJ lowered the evidentiary burden for everyone else."
WHAT DOJ, DEA AND ONDCP SHOULD DISCLOSE
MMJ calls upon the federal government to disclose:
Which state marijuana programs were evaluated before Order No. 6754-2026 was issued;
What performance measurements supported the Attorney General's findings;
Whether officials reviewed DEA's 2025 National Drug Threat Assessment;
Whether HIDTA intelligence and state enforcement records were considered;
Whether DOJ reviewed state laboratory suspensions, recalls and public-health advisories;
How DOJ evaluated inversion into licensed markets;
How it assessed the accuracy of state seed-to-sale databases;
What laboratory-integrity standards qualifying states must maintain;
What federal inspections will independently verify state information;
What safeguards apply while federal applications remain pending; and
Why MMJ's federally inspected application remains unresolved while state licensees receive expedited treatment.
A LICENSE IS PERMISSION-NOT PROOF
The misconduct of individual businesses should not be attributed to every state licensee. Nor does one enforcement failure prove that an entire state program is ineffective.
But DOJ did not issue an order addressing one business or one state.
It made a nationwide factual judgment about the collective reliability of state marijuana systems and used that judgment to create preferential federal treatment.
The ten-state record makes one conclusion unavoidable:
A state license is evidence of state permission.
It is not proof of lawful origin, accurate chemistry, uncontaminated products, reliable testing, truthful records or effective diversion control.
Those facts must be independently established.
"The Attorney General converted state confidence into federal policy," Boise said. "But confidence is not evidence. Before state credentials become a gateway to Schedule III treatment and expedited DEA registration, the Justice Department should show the public what it examined, what it failed to examine and why it concluded that these systems can perform the work federal law requires."
ABOUT MMJ INTERNATIONAL HOLDINGS, INC.
MMJ International Holdings, Inc. is a privately held pharmaceutical company developing standardized cannabinoid-based investigational medicines through federal pathways administered by FDA and DEA.
MMJ holds two Investigational New Drug files with FDA and Orphan Drug Designation for its Huntington's disease program. MMJ BioPharma Labs holds a DEA Schedule I analytical-laboratory registration. MMJ BioPharma Cultivation has a pending DEA bulk-manufacturing application.
MMJ's investigational programs concern potential treatments for Huntington's disease and multiple sclerosis.
CONTACT
Madison Hisey
MMJ International Holdings, Inc.
203-231-8583
CAUTIONARY STATEMENT
This release distinguishes final regulatory findings and adjudicated decisions from allegations in pending or contested proceedings. Criminal charges and complaint allegations are not evidence of guilt, and every defendant is presumed innocent unless and until proven guilty.
The government records discussed do not establish that every state licensee presents a diversion risk or that any state regulatory program is ineffective as a whole. MMJ's conclusions and questions reflect its review of published government materials, which readers should consult directly.
MMJ's product candidates are investigational, have not been approved by FDA and remain subject to Full Clinical Hold. No clinical trials involving MMJ's product candidates have been completed, and no conclusions concerning safety or efficacy may be drawn.
There can be no assurance that FDA will lift any clinical hold, that DEA will act upon MMJ's pending registration application or that any court or agency will reach a particular result.
MMJ is a petitioner in federal litigation concerning the April 2026 rescheduling order and an appellant in litigation concerning a CMS cannabinoid program. No court has ruled on the merits of MMJ's claims, and no outcome is predicted or implied.
Nothing herein constitutes an offer to sell or a solicitation of an offer to purchase any security.
SOURCE: MMJ International Holdings
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