Cann Group has said it will “vigorously defend” legal proceedings launched by New Zealand-based Rua Bioscience which has accused the cultivator of a breach of contract.

Rua is claiming damages against Cann Group subsidiary Cannoperations for an alleged breach of contractual rights to exclusively sell Cann’s medicinal cannabis products in Australia.

In proceedings lodged with the Supreme Court of Victoria, Rua claimed Cann was contracted to supply specific medicinal cannabis products exclusively to Rua for re-sale in Australia and New Zealand during the term of the contract.

The alleged breaches have caused Rua “significant damages”, the company said.

Cann Group said the legal action relates to a manufacturing and supply dispute “which has escalated over time” despite its efforts to resolve the issue “amicably”.

“Cann denies the claims bought against it and will vigorously defend the action,” it said in a statement.

Rua said in early December that Cann had given 12 months’ notice to terminate the supply agreement, which prompted the NZ operation to “consider its legal options”.

“There have been recent quality issues with Cann’s export products, which had already prompted Rua Bioscience to proactively explore alternative supply partnerships,” Rua told the NZ stock exchange late last year.

“In the last 12 months, Rua has placed emphasis on securing multiple additional supply pathways with particular emphasis on cultivating our unique genetics in Europe and Australia.”

Rua Bioscience chief executive Paul Naske added: “While we appreciate the history we have had with Cann, we are committed to ensuring the continuity of our operations and maintaining the highest standards in product quality.”

Steve has reported for a number of consumer and B2B titles over a journalism career spanning more than three decades. He is a regulator contributor to health journal, The Medical Republic, writing on...

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