Harborside Inc. Announces Filing Appeal in Tax Case

Harborside Inc. (“Harborside” or the “Company”) (CSE: HBOR), a California-focused, vertically integrated cannabis enterprise, announced today that it has formally filed notice of appeal to the United States Court of Appeals for the Ninth Circuit from the Tax Court decision in Patients Mutual Assistance Collective Corporation (d.b.a. Harborside Health Center) v. Commissioner. The Tax Court decision was issued on November 29, 2018. The ruling became final on October 11, 2019, when liability of US$11,013,237 was formally entered by the Tax Court. Harborside is properly filing its appeal within 90 days from that date.

“Harborside believes that the Tax Court misapplied the law as it relates to dispensaries, and this appeal represents our commitment to remaining a leader in the fight for local, state and federal legalization,” said Interim CEO Peter Bilodeau. General Counsel Jack Nichols pointed out that, “The Tax Court’s opinion provides an abbreviated and misleading discussion of the critical tax accounting issues regarding cost of goods sold.”

“There is an increasing realization that Section 280E as applied by the IRS is tax imposed without regard to income and violates the Sixteenth Amendment to the Constitution which requires that the federal tax must be measured by income, not sales. We remain hopeful that the Ninth Circuit will understand this,” declared Steve DeAngelo, the iconic co-founder of Harborside.

No opinion is expected from the appeal until late 2020. Harborside’s case will be argued in the Ninth Circuit by James Mann of Greenspoon Marder in New York.

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SOURCE Harborside Inc.