Monday, July 24, 2017

The Fraud With In:

Ultra Health’s Plant Cap Lawsuit

Duke Rodriguez, the now principal of Ultra Health LLC, got his start in the medical cannabis industry around 2013 in Arizona and since his start there has been a cloud of controversy following his business motives and actions.  

Rodriguez began in New Mexico with the purchase of the 11-acre medical cannabis growing facility in Bernalillo, NM Top Organics, in August 2014. At the time he bought the Bernalillo property, Rodriguez had no management agreements with a New Mexico licensed nonprofit producer, or LNPP as reported by the Albuquerque Journal.  Under state law, a nonprofit must be licensed by the Department of Health to produce cannabis. Rodriguez had made the purchase on behalf of an Arizona corporation called Zoned Properties Inc., a real estate company that specializes in medical cannabis growing facilities and dispensaries.
Earlier in 2014, back in Arizona where Ultra Health has their headquarters, Zoned Properties, Inc., had been party to 5 different lawsuits filed in Maricopa County Superior Court of Arizona. At this time Duke Rodriguez currently owned Cumbre Investment, LLC, that was a major stockholder (12.18%) of Zoned Properties. Zoned Properties, Inc., was suing Duke Rodriguez for fraud.
According to the Albuquerque Journal, Cumbre Investment, was formed by Rodriguez back in 1994. And the Albuquerque Journal further uncovered that; “in 1996, then-Gov. Gary Johnson appointed Rodriguez secretary of the state Human Services Department. Rodriguez resigned the post in October 1997, three days after the Journal reported that a firm he formed had received nearly $30,000 in “sales commissions” from a company that did business with the HSD. The Journal reported that Healthcare Business Solutions Inc. of Albuquerque paid $29,822 earlier that year to Cumbre Investment.” The cloud of controversy goes back that far…

Following the legal mess Rodriguez had with Zoned Properties, who paid $2.75 million for the 11.3-acre property, according to disclosures filed by the public company. A settlement reached in July 2015 in which Zoned Properties transferred ownership of the Bernalillo property to Rodriguez and Ultra Health. Under this settlement, Rodriguez transferred ownership of a 48-acre property and growing facility in Chino Valley, Ariz., to Zoned Properties. Rodriguez also relinquished his ownership stake in Zoned Properties according to Keyt Law in Arizona.
Rodriguez and his turnkey business, Ultra Health LLC, have somehow bypassed the application process that all the other State approved medical cannabis producers went through,  to gain control of NM Top Organics. How was a out of state business operator, who at one point in Gilbert (AZ) provided a invalid medical cannabis dispensary permit to City Council of Gilbert(AZ) for a dispensary, be allowed into the medical cannabis program here in New Mexico in this manner?
Peter St. Cyr reported that, “dispensary and cultivation management contracts provided to the Santa Fe Reporter by the New Mexico Department of Health show that the parties agreed to a 30-year deal granting Ultra Health use of the nonprofit’s license (NM Top Organics) to staff, manage and operate dispensaries around the state in exchange for Ultra Health returning up to $12,500 per calendar year to the nonprofit entity for its “exclusive use and/or charitable purposes.” Ultra Health wouldn’t say then how the money was used that year, which individuals make that decision, or whether any other sums of money changed hands.”
New Mexico Top Organics – Ultra Health, Inc. vs New Mexico Department of Health
In August 2016, attorney Brian Egolf filed a complaint in state district court in Santa Fe on behalf of the licensed producer New Mexico Top Organics–Ultra Health, Inc. The plaintiffs claim that the Department of Health has a restrictive plant cap and that makes it impossible to have enough plant material to develop specialty medications like Haleigh’s Hope. The production and distribution of medical cannabis is provided in the state by Licensed Non-Profit Producers (LNPP) and the Licensed Non-Profit Producers may grow no more than 450 total medical cannabis plants.
What is Haleigh’s Hope? Haleigh’s Hope is a high quality botanical oil made from organic, all natural ingredients. Haleigh’s Hope is also a trademarked product that is not owned by Ultra Health, and is owned by a company in Colorado. Haleigh’s Hope is mentioned over 10 times in the lawsuit filed against the Department of Health, and Ultra Health took it upon themselves to use the name of another company’s product using- it without any legal permission from Haleigh’s Hope™. Ultra Health then goes even further in this same lawsuit, page 19, to state how, “NMTO wishes to produce Haleigh’s Hope”. Once again this is done without any legal approval from the owners of Haleigh’s Hope. Ownership of Haleigh’s Hope learn of this fraudulent use of their name on Friday, July 21st 2017.
In the broadest sense, fraud can encompass any crime for gain that uses deception as its principal modus operandus. More specifically, fraud is defined by Black’s Law Dictionary as: a knowing misrepresentation of the truth or concealment of a material fact to induce another to act to his or her detriment. Consequently, fraud includes any intentional or deliberate act to deprive another of property or money by guile, deception, or other unfair means.
Ultra Health even states its intention to illegally make a product they do not own in a Santa Fe Reporter article, “The department could license more producers rather than increase plant counts, but O’Donnell says that would only solve the problem for two years and would not set up growers to benefit from economies of scale or have enough material to develop specialty medications like Haleigh’s extract the cannabinoids needed to make the drug requires lots of flowering buds”. O’Donnell, who holds a PhD in Economics from the University of New Mexico, goes on in the article to criticize the Department of Health for overseeing a plant that is an agriculture product, despite her having no formal agricultural background herself with cannabis.  
Before the plant cap lawsuit was even filed, in March of 2016, Ultra Health struck this lucrative deal; “ALBUQUERQUE, N.M., March 30, 2016 /PRNewswire/ -- Ultra Health, the largest and leading medical cannabis operator in New Mexico, has announced a joint venture with Panaxia Ltd, a pharmaceutical company based in Israel. Israel is recognized as the global center for cannabis-related research. The firms concluded an agreement after a 14-month negotiation and due diligence process. Panaxia will be providing smokeless proprietary cannabinoid dosage and treatment protocols not readily available in the U.S. in order to manufacture state-of-the-art products to treat a number of illnesses. The two companies will be building a production facility that implements Panaxia's technology.”
That cloud of controversy surrounding Duke Rodriguez and Ultra Health continues.
Ultra Health has this very profitable deal in place with Panaxia Ltd, a pharmaceutical company based in Israel. Then the Arizona based Ultra Health, files a lawsuit against the New Mexico State Department of Health claiming they don’t have enough plants to make a specific type of medicine called Haleigh’s Hope, which is a product owned by someone else. That’s a very bold move to lay out one’s own fraudulent intentions in using another company’s name and product in a lawsuit, and further state one’s desire to rip off and manufacture the same product yourself to sell for profit. And to further make such claims in a court of law, showing complete disrespect for the judicial process and to the Judge presiding over the case.
How can this lawsuit be true and accurate if the plaintiff, in Ultra Health, isn’t even able to produce the medicine, Haleigh’s Hope, that is mentioned over 10 times in the lawsuit?
And the same medicinal product, Haleigh’s Hope is available for sale in Albuquerque, Ultra Health doesn’t meet the standards to provide it and can not carry it.
As plaintiff, Ultra Health, expresses concerns about the medical cannabis program in referencing a study done on the medical cannabis program, The Medical Cannabis Market In New Mexico, released Aug. 2016. Rodriguez hired Kelly O’Donnell to produce a medical cannabis program data-driven market report that mainly focuses on the business aspects not the medical aspects. O’Donnell, was a former Regulation and Licensing Department Secretary under then-Gov. Bill Richardson, serving when Rodriguez did. This data driven report, that is repeatedly cited throughout the lawsuit was then followed up by another report one month later. O’Donnell’s second report was also commissioned by Ultra Health, Legalization of Cannabis for Social Use New Mexico Market Analysis, that was released September 16, 2016.
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Even if an increase in cannabis plants that a medical cannabis producer is allowed to grow was granted by the Department of Health, Ultra Health still would not be able to manufacture the specific medicine highlighted in this case. Rather the real issue for Duke Rodriguez, and his out of state operation in Ultra Health, is how the plant cap is keeping him from establishing a monopoly and profiting like he wants too off of sick patients in the program.  Ultra Health somehow bypassed the application process to obtain a medical cannabis producers license and now they are trying to pull this off in a court of law. What this lawsuit reveals is not compassion as it claims but the greed of this business, Ultra Health.

Ultra Health In The News
What is bad public relations?
Bad PR has no underlying plan, no strategy, no real purpose. It doesn't build a cohesive image of a company, products/services, bad PR is a waste of money. And when it involves a producer in a medical cannabis program, it further reflects a negative image of the entire medical cannabis program and its participants.
April 24, 2014 - Medical marijuana dispensary dispute - Eastern Arizona Courier  
“David Sanchez said Rodriguez had no right to impede the Holistic Wellness Center’s business by padlocking its doors and that the lease, building permits and conditional use permits were all in the Sanchezes’ name until Rodriguez went behind their back and had the lease changed over to his group without their knowledge.”
July 12, 2014 - Gilbert revokes permit for medical-marijuana site - The Republic |
“A medical-marijuana dispensary near Power and Warner roads in Gilbert likely won’t be opening any time soon as the town’s Planning Commission recently revoked the developer’s site use permit. . . . One developer, Duke Rodriguez with Ultra Health, held the use permit from the town, that was determined to be an invalid permit not recognized by the Arizona Dept. of Health.”  
May 8, 2015 - Consolidating and cashing in on medical marijuana - By Joey Peters                   
“Leonard Salgado, Ultra Health’s director of New Mexico operations, said the company’s deal with Top Organics amounts to helping it position for the future. Salgado noted how quickly the marijuana industry is evolving.
“We’re so close to Colorado geographically,” Salgado, who would not disclose more details about the deal because the terms are confidential, said. “Who knows when we will be migrating to that model?” (NM Political Report)
February 29th, 2016 - ABQ Girls Scouts sell cookies near pot dispensary, violating policy - “ALBUQUERQUE, N.M. — Two Albuquerque Girls Scouts have picked an unusual spot to sell Girl Scout cookies — a marijuana dispensary.
KRQE-TV in Albuquerque reports ( a Junior Girl Scout and a Brownie set up shop Saturday outside medical marijuana dispensary Ultra Health and sold more than 60 boxes.
Ultra Health manager James Gambling says he invited the scouts and offered to donate $1 for every box the girls sold. He says “the munchies” is a stereotype that comes with marijuana, so it was fitting to have the Girl Scouts outside.” (ABQ Journal)
February 29th, 2016 - Not enough medical pot to go around - By Duke Rodriguez                            
 “This cannabis plant count limitation prevents the production of sufficient medical grade cannabis to treat highly ill patients. Recently, the media reported of the youngest patient in the nation (two months old) to receive CBD oil (extract from cannabis plants) to treat life threatening epileptic seizures. This baby was from Albuquerque and required the family to relocate to Colorado to get the life-saving treatment.” (ABQ Journal)
March 6th, 2016 - Editorial: Compassion lost in cloud of medical pot’s big profits - By Albuquerque Journal Editorial Board     
“Back in 2007, a “licensed producer” meant “any person or association of persons within New Mexico that the department determines to be qualified to produce, possess, distribute and dispense cannabis pursuant to the Lynn and Erin Compassionate Use Act and that is licensed by the department.” Now at least one of those so-called licensed producers, New Mexico Top Organics, isn’t producing anything except a contract with the for-profit, Arizona-based Ultra Health LLC and its 11-acre growing facility in Bernalillo.
Ultra Health is run by former New Mexico Human Services Department Secretary Duke Rodriguez, who says openly that the nonprofit model is “window dressing,” and he hopes to replicate his $5 million pot farm partnership with Nevada’s Paiute tribe with a pueblo here, as well as gear up production for legalized recreational marijuana in New Mexico.” (ABQ Journal)
Mar 30, 2016 - Ultra Health Announces Cannabis Joint Venture With Panaxia, An Israeli Pharmaceutical Company - PRNewswire
Ultra Health, the largest and leading medical cannabis operator in New Mexico, has announced a joint venture with Panaxia Ltd, a pharmaceutical company based in Israel.
April 12, 2016 - NM marijuana industry generous in political donations - By Sandra Fish | New Mexico In Depth  
“Marijuana-related businesses and their executives donated at least $13,500 to House Majority Leader Nate Gentry, a report filed Sunday reveals.
Of that, $10,000 came from Ultra Health LLC and its founder, Duke Rodriguez, a former Lovelace Medical Center executive. The Scottsdale, Ariz., based for-profit recently took over management of Santa Fe’s New Mexico Top Organics, according to Peter St. Cyr’s recent report in the Santa Fe Reporter.” (NM Political Report)
June 10th, 2016 - Legalize marijuana to adequately finance Medicaid -
By Duke Rodriguez / Former Secretary, New Mexico Human Services Department; Principal, Ultra Health LLC
“Enter the argument for the legalization of the social use of cannabis on a statewide level.
Conservative estimates based on the social use of cannabis and increased sales taxes in neighboring states indicate that recurring revenues could be in the range of $75 million to $100 million annually.” (ABQ Journal)
Jun 17, 2016 - Cannabis Company Denied Sponsorship At Albuquerque International Balloon Fiesta - PRNewswire
“Ultra Health, a national medical cannabis leader with a large New Mexico presence, is denied sponsorship for the Albuquerque International Balloon Fiesta® (AIBF), the largest balloon event and most photographed event in the world.”
Jun 28, 2016 - Reader View: Demand for medical cannabis has never been higher -By Duke Rodriguez “Duke Rodriguez is the president/CEO of Ultra Health LLC, former COO of Lovelace Health Systems, former president of Diagnostek Inc. and former Cabinet secretary of the New Mexico Human Services Department. (SFNM)
July 7, 2016 - Gathering of Nations gets medical pot provider as sponsor - The Associated Press  
“ALBUQUERQUE — A medical marijuana company operating in New Mexico and Arizona has signed on as a sponsor of one of North America’s largest powwows.” (SFNM)  Deborah White Plume, whose husband, Alex White Plume has been an advocate for the growing of hemp for decades, says she has mixed emotions about the sponsorship. “First of all, I am curious what the organizers get for sponsorship. But ultimately though I use medical marijuana, I feel this is an exploitative and corporatizing of Native people. I think it would be friendly and respectful if Ultra Health took their name off of the event name, otherwise, it is just another exploitative and oppressive gesture to the red nation.”
July 29th, 2016 - State says marijuana cannot be certified ‘New Mexico True’ - Associated Press “SANTA FE, N.M. - State officials say no matter where marijuana is grown it is not eligible for New Mexico True certification. The Santa Fe New Mexican reports ( ) that Ultra Health President Duke Rodriguez says he has been denied the chance to participate in the New Mexico Tourism Department initiative” (ABQ Journal)
Aug 17, 2016 - Mother’s lawsuit seeks to strike medical pot production cap - by Dan Schwartz        
“New Mexico Top Organics-Ultra Health Inc., a licensed cannabis supplier in the state, is the second plaintiff in the suit against the Department of Health, according to a news release from the company. The type of cannabis that relieves the type of seizures from which Sena’s daughter suffers is called Haleigh’s Hope, a strain low in the compound that produces psychotropic effects, according to the lawsuit. The drug has completely ended the baby’s seizures, allowing her to develop mentally, the lawsuit states.” (SFNM)
September 1st, 2016 - Pot purveyor says state delaying his bid to open more stores - By Olivier Uyttebrouck  
“ALBUQUERQUE, N.M. — Duke Rodriguez’s plan to build a statewide chain of cannabis retail stores has hit a snag. Rodriguez, owner of Ultra Health LLC, contends that state regulators have slow-tracked his request to open at least 14 new stores, most located in communities that now lack dispensaries.” (ABQ Journal)
September 8th, 2016 - State questions hip-hop video shot in medical marijuana greenhouse -By Colleen Heild  
“The plants on the video appear to be housed inside a Bernalillo greenhouse owned by New Mexico Top Organics – Ultra Health, one of 35 licensed producers in the state. And that has raised security questions from the state about how the crew of hip-hop artists was allowed to film, dance and sing with hundreds of supposedly highly secured marijuana plants as a backdrop.” (ABQ Journal)
September 10, 2016 - YouTube video shot inside medical pot facility raises questions - Associated Press  “ALBUQUERQUE — One of New Mexico’s licensed pot producers is under fire over a YouTube music video featuring the facility’s marijuana as a backdrop.
The Albuquerque Journal reports that a Sept. 1 letter from the state’s Medical Cannabis Program asks New Mexico Top Organics — Ultra Health how hip-hop artist Versatile Verse managed to get inside the facility and what benefit the video offers to qualified patients or the program.
“What is the intended purpose of the video?” Ken Groggel, manager of the state’s Medical Cannabis Program, asked in a letter Ultra Health later posted on Instagram. “Who is the intended audience?” (SFNM)
September 10th, 2016 - State Fair yanks grower for display of marijuana plant - By Olivier Uyttebrouck   “The Department of Health, the state agency that oversees the medical cannabis program, said in a written statement Friday that Ultra Health may have violated the state’s medical cannabis law by displaying a plant outside a secured production facility.”  (ABQ Journal)
September 20, 2016 - Economic Report Suggests New Mexico Legal Cannabis Sales Would Exceed $400mm in First Year - by Alan Brochstein  
“An economic analysis commissioned by Ultra Health and supported by Drug Policy Alliance and the Rio Grande Alliance suggests that New Mexico retailers could see annual revenue in excess of $400mm in the first year and almost $700mm by the fifth year if it were to legalize cannabis for social use. The author of the report, Kelly O’Donnell, who holds a PhD in Economics from the University of New Mexico and runs O’Donnell Economics & Strategy”  (New Cannabis Ventures)
November 5th, 2016 - Pot-showing company hit with sanctions - By Colleen Heild          
“But health department officials informed Ultra Health that removing the medical marijuana plant from the company’s Bernalillo production facility to the State Fair violated state law that requires cannabis production facilities “be housed on secured grounds.”  (ABQ Journal)
March 1, 2017 - Feds warn NM producer about cannabis at Cannabis Cup - By Andy Lyman
“A letter from the U.S. Department of Justice to organizers of a cannabis festival in Nevada could signal how the Trump administration plans to enforce marijuana laws.
Nevada’s U.S. District Attorney sent a letter last week to Duke Rodriguez, CEO of the New Mexico and Arizona based Ultra Health, with concerns that cannabis will be present at the High Times Cannabis Cup.” (NM Political Report)
March 3, 2017 - First US cannabis pharmaceutical lab launches in NM, says Ultra Health -
“Ultra Health is joining forces with Panaxia Pharmaceuticals Industries Ltd., an Israeli company established in 2010, to produce the medicine. Panaxia will be providing smokeless proprietary cannabinoid dosage and treatment protocols.” BizJournal
March 4th, 2017 - Justice Department warns pot festival organizers - By Olivier Uyttebrouck
“A warning from the U.S. Department of Justice caused some last-minute scrambling by the organizers of a marijuana festival scheduled this weekend near Las Vegas, Nev., co-sponsored by a Nevada tribe and one of New Mexico’s largest medical cannabis producers.
Nevada’s U.S. Attorney Daniel Bogden sent a Feb. 23 letter to Ultra Health LLC warning that “marijuana remains illegal under federal law” and threatening organizers with prosecution if cannabis is distributed at the event.” (ABQ Journal)

Duke Rodriguez, of Ultra Health LLC, got his start in the medical cannabis industry around 2013 in Arizona and since his start there has been a cloud of controversy following his business motives and actions that clearly continue to this day.
“Rodriguez said he was never investigated for wrongdoing for his actions as secretary.” - February 14th, 2016

By Jason Barker

1 comment:

  1. Everything he does involves a lawsuit. He's a pro at what he does in the courts, but he has people behind him even you couldn't touch.