From an article in San Francisco Business Times:
Ousted Cannabis Science Chairman, President and CEO Steven Kubby distributed company funds for personal gain, signed financial and share agreements without board consent and blocked the access of other officers and directors to a company account, the company said in a regulatory filing. [...]
The company said in its SEC filing that Kubby signed financial and share agreements with Ruwart, [Ruwart's husband and COO Ray] Carr and a private party that were not disclosed to or approved by the board, “using unauthorized company shares as collateral or consideration for his personal gain.”
Steve Kubby and Mary Ruwart were candidates for the 2008 Libertarian Party Presidential nomination, and Ruwart is an At Large member of the Libertarian National Committee. Kubby’s account of these events was reported earlier on IPR. A response by Cannabis Science CFO (and Kubby’s former campaign manager) Richard Cowan is at MarijuanaNews.com.
16 responses so far ↓
1 Susan Hogarth // Jul 15, 2009 at 12:56 pm
All the CS FEC filings – including the one referenced here – can be found here:
http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001024626&owner=include&count=40
2 paulie // Jul 15, 2009 at 1:43 pm
SEC. FEC is the elections goon squad, as I’m sure you are well aware.
3 John C // Jul 15, 2009 at 2:52 pm
Perhaps libertarians should avoid corporate fund raising schemes for their business ideas.
4 NewFederalist // Jul 15, 2009 at 3:17 pm
Kinda sounds like Preston Tucker… 2009!
5 Joey // Jul 15, 2009 at 4:38 pm
Has anyone seen the FEC filings for how much Michael Emerling Cloud and his dame Carla Howell made off with in the 2008 income tax repeal ballot election last year in Mass?
I understand statewide petition campaigns are expensive, but I received no less than two or three emails saying “we’re broke!”
Reading the FEC filings will give those an indication of why!
Really, it’s no surprise anymore, it really isn’t…
6 George Phillies // Jul 15, 2009 at 5:03 pm
Massachusetts referenda do not file with the FEC.
George Phillies
7 Susan Hogarth // Jul 15, 2009 at 5:13 pm
Thanks, P. Yes, sorry, SEC.
8 paulie // Jul 15, 2009 at 6:48 pm
Joey,
Cloud and Howell only have a professional relationship anymore. As far as I could see working on those initiatives the money was spent frugally.
9 Thomas L. Knapp // Jul 15, 2009 at 8:33 pm
John C.,
You write:
“Perhaps libertarians should avoid corporate fund raising schemes for their business ideas.”
My visceral reaction to that is a-friggin’-men.
On the other hand, the choice Kubby faced appears to have been between entering into “corporate fund raising schemes” on one hand, or letting an idea with big possibilities go undeveloped.
Those “big possibilities” go way beyond big profits for Kubby. They include lives saved, quality of lives improved, etc.
I helped write the initial business plan, and am still excited by the prospects. * It’s sad to see an important product trapped in this kind of corporate dispute hell.
I’m investigating the allegations in CSI’s latest 8-K filing. I expect slow going, but frankly allegations (a) and (b) already appear to be 100% pure grade-A bullshit.
To put it in simple terms:
- Kubby was promised 6.5 million shares of Gulf Onshore as payment for that company’s purchase of Cannex’s assets on March 30th.
- On April 6th, Kubby took out two loans for $5,000 each — one from Dr. Ruwart and Mr. Carr, the other from an individual whom I will not name, since CSI hasn’t. The loan agreement included a restricted (no resale for six months, etc.) OPTION for the lenders to take full or partial repayment in the form of Kubby’s Gulf shares at 20 cents each (the entire principal of the two loans combined would therefore have come to 50,000 shares).
Later in April, Gulf Onshore changed its name to Cannabis Science, Inc.
I don’t see any “there” there on those allegations. My guess is that they were trumped up into “bad things” in a hurry so that CSI could respond to Kubby’s allegations with allegations of its own instead of having to actually defend its own conduct.
Regards,
Tom Knapp
* Appropriate disclosures:
I am not, nor have I ever been, an employee of, or investor in, Cannex, Gulf Onshore or CSI. I did some writing work on the initial business plan as a contractor, and asked that my compensation (low triple digits) be deferred until it would constitute a minor expense instead of paid at a time when the company was grubbing hard for money to get things done.
I consider certain past or present Cannex/CSI principals — Steve Kubby, Dr. Ruwart, Ray Carr and R. Lee Wrights — long-time friends, and have had renumerative business relationships with them in the past (I worked for pay on the Kubby and Ruwart presidential campaigns, and Lee and I are long-time partners in Rational Review).
Obviously, these disclosures should bear on any evaluation of my objectivity.
10 mdh // Jul 16, 2009 at 8:36 am
This is just dirty people trying to pawn off their dirty dealings onto good people. Someone ought to bring these bastards down, and I don’t mean the government.
11 Joey // Jul 16, 2009 at 11:39 am
Thanks for the correction, Mr. Phillies.
The Mass. version of the ethics commission/reporting agency that handles political PACs and other things, etc. is what I meant to say…
Thanks.
12 Susan // Jul 28, 2009 at 10:26 am
Steve has stepped in it deep this time. Let’s see if he has another life to get out of this trouble if it materializes.
13 Susan // Jul 28, 2009 at 10:33 am
oh and here’s Richard’s report on it
http://marijuananews.com/blog/general-news/someone-is-lying-kubby-fired-by-cannabis-science-accuses-melamede-and-cowan-of-theft-etc-are-you-a-thief-if-you-don%E2%80%99t-agree-with-me/
14 paulie // Jul 28, 2009 at 10:34 am
Yes, Susan (?), I linked that in the article you are commenting on. Thanks again!
15 paulie // Jul 28, 2009 at 10:35 am
Correction, another IPR writer did.
16 Formerly worked by SK // Jul 29, 2009 at 5:27 am
When I heard that Kubby had a new business I asked myself how many months until controversy erupts. Lo and behold! Not Many!
It’s funny how Stevie keeps having these “issues”, after all he’s got his CA Med card now and you’d think he would be able to figure out how not to *Keep Borrowing Money* but…
This same story will be repeated within the next few years, I’d bet on it.
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