Cookies Awarded $22.7 Million in Arbitration Against Retail Partner for Breach of Contract and Trademark Misuse

OG article

June 18, 2025

On June 2, 2025, Cookies, a leading San Francisco Bay Area-based cannabis brand, secured a final arbitration award of $22.7 million against its retail partner, Cookies Retail LLC (CRE), following a dispute over unpaid royalties and unauthorized use of intellectual property. The ruling, issued by retired San Francisco Superior Court Judge David Garcia, builds on an interim February 14, 2025, award of $18 million, with the final amount comprising $17.8 million in damages and $4.8 million in legal costs and fees.

Arbitration Findings and Legal Basis

Judge Garcia determined that Cookies substantiated its claims of liability and damages related to CRE’s failure to pay agreed-upon royalty fees and misuse of Cookies’ trademarks to raise capital without authorization. The arbitration stemmed from a January 2020 licensing agreement between Cookies, co-owned by entrepreneur and musician Gilbert Milam (known as Berner), and CRE, a Southern California-based entity led by Brandon Johnson, CEO and co-founder of Los Angeles-based TRP Co. The agreement authorized CRE to operate Cookies-branded retail stores in California, Colorado, Florida, Massachusetts, Oklahoma, and Oregon, leveraging Cookies’ proprietary cannabis strains and iconic branding, including its distinctive “C” logo and light-blue color scheme, promoted through Berner’s significant social media presence.

Under the terms of the agreement, CRE was obligated to pay royalties for the use of Cookies’ intellectual property. However, Garcia’s ruling found that CRE ceased these payments in 2021, coinciding with a softening cannabis retail market, while continuing to exploit Cookies’ trademarks to secure separate capital. The arbitrator further concluded that CRE operated as an alter ego of TRP Co., reinforcing the liability findings.

Background of the Dispute

The partnership originated in a 2019 joint venture facilitated by Johnson, involving Gron Ventures Fund, a venture capital entity linked to Toba Capital’s Vinny Smith. Cookies held a 20% stake in the venture, with Johnson and Gron Ventures controlling the remainder. The venture aimed to establish Cookies-branded retail stores operated by existing or co-owner operators under a Retail License Agreement. These stores were to sell Cookies-branded products alongside other brands, with Cookies receiving royalties and retaining the option to acquire the stores in the future, subject to applicable laws.

Despite the initial agreement, Garcia noted that Johnson and his partners shifted strategy in 2021, forming TRP Co. and halting royalty payments, even as they acknowledged their obligations in communications. The unauthorized use of Cookies’ intellectual property to raise capital further compounded the breach.

Cookies’ Response and Future Implications

Cookies President Parker Berling expressed satisfaction with the ruling, stating, “The company has been eager to address this matter and is very pleased with the arbitrator’s decision to increase the final award to $22.7 million in damages and fees.” The ruling raises questions about the future of Cookies-branded stores within TRP’s portfolio, particularly as Cookies signaled its intent in 2024 to acquire certain related assets, including operational cannabis assets in Florida.

CRE’s Legal Challenge

CRE, represented by attorney Thomas O’Connell, has filed a petition to vacate the arbitration award, alleging that Judge Garcia exceeded his authority and that the ruling was tainted by “corruption, fraud, or undue means,” according to court documents dated June 6, 2025. Legal experts note that overturning binding arbitration awards in California is rare and typically requires exceptional circumstances. Neither O’Connell nor Johnson responded to requests for comment.

Broader Context

Cookies, renowned for its high-potency cannabis strains and global brand recognition, has faced multiple legal challenges in recent years, including lawsuits from investors and partners alleging mismanagement and coercive business practices. The successful arbitration outcome strengthens Cookies’ position in protecting its intellectual property and enforcing contractual obligations, reinforcing its strategic focus on brand integrity and supply chain control.