Article by Vanmala Subramaniam, Growth Op
The son of one of Aphria Inc.’s co-founders and a corporation registered to the address of unlicensed cannabis store Cannabis and Fine Edibles (CAFE) are some of the winners of Ontario’s second cannabis lottery, which named 42 applicants who will now be eligible to apply for a licence to operate a cannabis store in the province.
The Alcohol and Gaming Commission of Ontario — which is in charge of regulating the cannabis retail sector — received over 4,800 applications for the lottery. But unlike the last lottery round, the AGCO imposed stricter requirements for applicants, insisting that they had secured retail space and could provide a letter of credit of $50,000 to the regulator.
There were 13 winners named to open stores in the Toronto region, including 11180673 Canada Inc., a corporation whose address is listed as 104 Harbord Street, one of CAFE’s former cannabis dispensary sites which was shut down by law enforcement in July.
CAFE, which has operated a chain of unlicensed dispensaries in Toronto since 2016, continued to keep their stores open after legalization took place — that effectively bars the owners, or any entity affiliated to them from operating a legal store, according to provincial rules.
“I’m assuming that the AGCO is going to take a very close look at who the winner of that site is affiliated with,” said Trina Fraser, a cannabis lawyer and partner at Brazeau Seller Law. “Having said that, it’s not necessarily a bad business strategy to secure a location that already has a customer base and is known for being a dispensary,” she said.
An applicant by the name of Cory Floyd Cacciavillani was also named as a winner to open up a store in Burlington, Ont. According to a friend of the family, Cacciavillani’s father is Cole Cacciavillani one of the founders of Leamington-based licensed producer Aphria, who is no longer with the company but remains a large shareholder.
Another winner was Najla Guthrie, whose store is registered to an address in Toronto’s Beaches neighbourhood. Guthrie is the CEO of KGK Science, a research organization that conducts clinical research into nutritional products and cannabidiol. KGK Science’s parent company is Auxly Cannabis, an entity founded by industry pioneer Chuck Rifici.
There were seven winners in Ontario’s East Region, 19 in Toronto and the Greater Toronto Area, five in Ontario’s northern region, which includes additional stores in Thunder Bay, and 11 winners in the province’s western region. Like the first lottery round, most of the winners appeared to be individuals or sole proprietors with little connection to the cannabis industry, whether legally or illegally.