The Cannabis Regulatory Agency (CRA) has formally filed multiple complaints (1, 2, 3, 4) against Hongrui Enterprises, Inc., a medical cannabis cultivation business located at 1100 Industrial Blvd., Albion, Michigan. The complaints highlight a series of alleged violations of the Medical Marihuana Facilities Licensing Act (MMFLA) and related administrative rules, potentially leading to severe sanctions, including fines, suspension, or even revocation of the company's licenses.
Hongrui Enterprises holds four active, stacked Class C medical marijuana grower licenses, which allow the company to cultivate a specific number of plants under Michigan law. According to the CRA, the company has committed numerous violations, as detailed in their formal complaint:
Surveillance System Issues: During an August 2023 site visit, CRA investigators discovered that the Michigan State Police had seized Hongrui's surveillance system, leaving the facility without video monitoring capabilities. Despite this, the business continued to operate without a functioning surveillance system. When CRA investigators returned in November 2023, the surveillance issues persisted, with cameras not recording and no employee on-site who could operate the equipment.
Unsecured Facilities: The complaints describe a facility that failed to meet basic security requirements. In multiple inspections, investigators found grow rooms and other sensitive areas left unlocked, allowing unauthorized access. Garage doors were also left partially open and inadequately secured, presenting additional security risks.
Untracked and Untagged Cannabis: Investigators found a significant number of untagged and untracked cannabis plants. During the initial inspection, 3,171 untagged plants were discovered, far exceeding the number allowed under Hongrui's licenses. By March 2024, the number of plants had ballooned to 10,738—more than double the permitted amount.
Fire Safety Violations: The Bureau of Fire Services (BFS) conducted inspections in March and April 2024, revealing numerous fire code violations. These included unsafe electrical work, obstructed exits, and a disabled fire protection system. The lack of a working fire protection system and unauthorized modifications to the facility raised significant safety concerns.
Improper Storage and Handling of Chemicals: The CRA found chemicals improperly stored in various locations throughout the facility. These were not secured in locked storage areas as required by regulations, further compounding the facility's non-compliance.
Failure to Comply with Regulatory Requirements: Hongrui Enterprises reportedly failed to maintain proper documentation, including employee records and Standard Operating Procedures (SOPs), and did not conduct required criminal background checks on prospective employees. The company also did not report material changes to their operations, such as the installation of new LED lighting, to the CRA as mandated.
Given the scope of the violations, the CRA has indicated its intent to impose substantial penalties, which could include fines, suspension, revocation, or refusal to renew Hongrui's licenses. The agency has provided Hongrui with the opportunity to request a hearing or a compliance conference to discuss the allegations and potentially mitigate the consequences. However, if the company fails to respond within the designated timeframe, a contested case hearing will be scheduled to resolve the matter.
These allegations, if proven true, underscore serious lapses in compliance and operational standards at Hongrui Enterprises, potentially jeopardizing both public safety and the integrity of Michigan's regulated cannabis industry.
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