Gold Flora, a cannabis company based in Southern California, with 16 dispensaries across the state, is planning to sell its assets through a receivership due to financial challenges faced by the industry. Established in 2017, the company is grappling with rising operational costs and legal fees from a merger. The Costa Mesa-headquartered firm, which brings in over $100 million in annual revenue, anticipates its dispensaries and 10,000-square-foot cultivation facility to be sold under receivership in Los Angeles Superior Court.

Gold Flora's CEO, Laurie Holcomb, stated that while the business retains value, receivership is the necessary route to sell the company as a viable entity. Because marijuana is not federally legal, cannabis businesses cannot file for bankruptcy like other industries. Therefore, a court-monitored receivership process enables the auctioning of assets to repay investors and creditors.

Among Gold Flora's popular dispensaries are Airfield Supply Co. in San Jose and Calma in West Hollywood, where they distribute well-known cannabis brands like Monogram, curated by rapper Jay-Z. In its recent filing, the company reported total assets of $209.7 million and liabilities of $273.1 million as of September 30, with a net loss of $18.8 million on revenues approaching $32.6 million in the third quarter of 2024.

Gold Flora is not the sole cannabis enterprise facing obstacles; prominent dispensary chain MedMen has also encountered challenges, resulting in closures and legal disputes. The California cannabis sector is highly competitive due to the "green rush," compounded by federal regulations categorizing cannabis as a Schedule I drug. This classification restricts financial institutions from collaborating with marijuana companies, hindering their access to loans, banking services, and credit card processing. Additionally, cannabis businesses contend with elevated tax burdens due to IRS regulations disallowing typical deductions related to selling controlled substances.