v3.21.2
Commitments and Contingencies
9 Months Ended
Sep. 30, 2021
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies COMMITMENTS AND CONTINGENCIESLegal Proceedings
In the ordinary course of business, we are involved in various legal proceedings involving a variety of matters. We do not believe there are any pending legal proceedings that will have a material adverse effect on our business, consolidated financial position, results of operations, or cash flows. However, the outcome of such legal matters is inherently unpredictable and subject to significant uncertainties.

Subsequent to the announcement of Greenlane’s acquisition of KushCo, three complaints were filed against Greenlane and its directors: one is captioned Richard Garreffa v. Greenlane Holdings, Inc., Aaron LoCascio, Adam Schoenfeld, Neil Closner, Richard Taney and Jeff Uttz, Case No. 1:21-cv-05512 (S.D.N.Y.), filed June 23, 2021; one is captioned Lance K. Callaghan v. Greenlane Holdings, Inc., Aaron LoCascio, Adam Schoenfeld, Neil Closner, Richard Taney and Jeff Uttz, Case No. 1:21-cv-05635 (S.D.N.Y.), filed June 29, 2021; and one is captioned Eric Sabatini v. Greenlane Holdings, Inc., Aaron LoCascio, Adam Schoenfeld, Neil Closner, Richard Taney, and Jeff Uttz, Case No. 2:21-cv-06571 (C.D. Cal.), filed August 13, 2021 (the “Actions”). The Actions name as defendants Greenlane and each of the members of the Greenlane board of directors. The Actions allege, among other things, that all defendants violated provisions of the Securities Exchange Act of 1934, as amended, (the "Exchange Act") insofar as this registration statement on Form S-4 preliminarily filed by Greenlane on May 28, 2021 allegedly omits material information with respect to the transactions contemplated therein that purportedly renders the preliminary registration statement false and misleading. The complaints seek, among other things, injunctive relief, rescissory damages, an award of plaintiffs’ fees and expenses and a trial by jury. The two cases filed in the District Court for the Southern District of New York have been voluntarily dismissed by the plaintiffs. The Company believes the claims asserted in the remaining Action are without merit and intends to vigorously defend them.

KushCo, a predecessor-in-interest to Greenlane Holdings, LLC, and its directors were also named as defendants in two lawsuits related to KushCo’s merger with Greenlane: one is captioned Hugh Meighan v. KushCo Holdings, Inc., Nick Kovacevich, Eric Baum, Barbara Goodstein, Donald H. Hunter, Dallas Imbimbo, and Pete Kadens, Case No. 1:21-cv-04048 (E.D.N.Y.), filed on July 19, 2021 (the "Meighan Matter"), and one is captioned Cliff Hartfield v. KushCo Holdings, Inc., Nicholas Kovacevich, Eric Baum, Barbara Goodstein, Donald H. Hunter, Dallas Imbimbo, and Pete Kadens, Case No. 1:21-cv-06818 (S.D.N.Y.), filed on August 13, 2021 (together with the Meighan Matter, the “KushCo Actions”). The KushCo Actions name as defendants KushCo and each of the members of the KushCo’s board of directors. The KushCo Actions allege, among other things, that all defendants violated provisions of the Exchange Act, insofar as the definitive joint proxy statement filed by KushCo allegedly omits and/or misrepresents material information concerning (i) KushCo and Greenlane’s financial projections, (ii) the financial analyses performed by KushCo’s financial advisor, Jefferies LLC ("Jefferies"), in connection with its fairness opinion, and (iii) potential conflicts of interest involving Jefferies that purportedly render certain sections of the definitive joint proxy statement false and misleading. The complaints seek, among other things, injunctive relief, rescissory damages, an award of plaintiffs’ fees and expenses and a trial by jury. The Meighan Matter was voluntarily dismissed by the plaintiffs. The defendants believe the claims asserted in the KushCo Actions are without merit and intend to vigorously defend them.
Other Contingencies

We are potentially subject to claims related to various non-income taxes (such as sales, value added, consumption, and similar taxes) from various tax authorities, including in jurisdictions in which we already collect and remit such taxes. If the relevant taxing authorities were successfully to pursue these claims, we could be subject to significant additional tax liabilities.
See "Note 5—Leases" for details of our future minimum lease payments under finance lease liabilities and operating lease liabilities. See "Note 11—Incomes Taxes" for information regarding income tax contingencies.