Top cannabis regulator O'Brien sues treasurer over suspension

Shannon O'Brien, the former state treasurer and Democratic nominee for governor, filed a lawsuit Thursday accusing Treasurer Deborah Goldberg of unlawfully removing her as chairwoman of the Cannabis Control Commission.

The lawsuit, filed in Suffolk Superior Court, is the latest sign of upheaval around the agency that oversees the state's legal cannabis sector and lays bare details of internal acrimony.

A hearing on the preliminary injunction that O'Brien is seeking to stop Goldberg "from continuing her unlawful removal of Chair O'Brien from her position at the CCC" is scheduled for next Friday, Oct. 6.

Goldberg, who appointed O'Brien to chair the commission a year ago, suspended her without publicly offering a reason two weeks ago. Hours before O'Brien's lawsuit was first reported by the Boston Globe, Goldberg issued a statement saying she moved to suspend O'Brien based on "[s]everal serious allegations" that were made by an unnamed commissioner and staff about O'Brien's behavior.

The office of Howard Cooper, a founding partner at Todd & Weld LLP who represents O'Brien, did not respond to questions from the News Service on Thursday.

O'Brien's lawsuit charges that "Treasurer Goldberg removed Chair O'Brien without notice, without articulated reason, and without any opportunity to be heard, all of which is required by the clear and unambiguous provisions of Massachusetts law ... as well as basic norms of due process." It argues that O'Brien has suffered professional and personal harms as a result.

The state law that dictates how appointments to the commission are made includes a section giving a treasurer (as well as a governor and attorney general) the ability to remove a commissioner they appointed if the commissioner "is guilty of malfeasance in office; substantially neglects the duties of a commissioner; is unable to discharge the powers and duties of the office; commits gross misconduct; or is convicted of a felony."

The commissioner "shall be provided with a written statement of the reason for removal and an opportunity to be heard" before removal, the law says. It does not appear to speak directly to the suspension of a commissioner.

O'Brien's complaint says Goldberg reached out around July 2022 to ask O'Brien to apply to be the commission's chairperson. O'Brien was skeptical, her filing claims, because previous Chair Steven Hoffman resigned under uncertain circumstances.

The complaint says that Goldberg wanted O'Brien "to be a change agent at the commission, an agency which is widely recognized to be broken and failing to serve the public interest, and the interests of disadvantaged communities in particular, because of an entrenched bureaucracy and infighting."

"The very same entrenched bureaucracy successfully rid itself of the prior CCC Chair through the making of false allegations against him," the complaint adds.

It also claims that Goldberg "informed Chair O'Brien at that time that she was not happy with how the CCC was operating, and specifically expressed her disappointment with the performance of the CCC's Executive Director."

Asked for a response Thursday afternoon to O'Brien's lawsuit, a spokesman for Goldberg said, "The Treasurer is confident that she has taken the appropriate actions to address the matter."

But earlier in the day, Goldberg's office put out a statement that represented the treasurer's first public comments on the situation at the commission since she suspended O'Brien two weeks ago

"Several serious allegations were made by a Commissioner and CCC staff about the Chair's behavior and the CCC initiated an investigation, hiring an outside law firm. The law firm undertook an investigation and has returned with a report. According to the CCC's employee handbook, suspension with pay is the only allowable remedy at this point, as the findings are being reviewed and action is considered," Goldberg said. "A second challenge involved in this situation is that the enabling legislation for the Commission clearly establishes the CCC as an independent entity. The role of the Treasurer is to appoint the Chair and jointly appoint two other Commissioners, but beyond that the office of the Treasurer has no other authority, oversight, management, or influence over the Commission."

It was a bumpy one year as chair of the commission for O'Brien, a Democrat who served as state treasurer from 1999 until 2003.

The board wrestled with thorny and awkward issues surrounding O'Brien and her one-time ownership stake in a cultivation company that had an application before the CCC. She was later cleared of any wrongdoing.

And in July, O'Brien caught commissioners and staff off guard when she announced that Shawn Collins, the only executive director the commission has had in its six-year history, was planning to step down at the end of the year and that he wanted to take family leave before then. She said the situation put the CCC "in crisis" as it approached the finish line for its latest rewrite of cannabis industry regulations.

The chairwoman later apologized for any "angst" or "confusion" she caused with her announcement. Collins publicly pushed back against the assertion that the commission was "in crisis" and denied that he had any set plan to leave at the end of the year.

O'Brien served six years in the Massachusetts House and two years in the Massachusetts Senate in the late 1980s and 1990s, and was the Democratic Party's nominee for governor in 2002 in the election against Mitt Romney.

After leaving politics, O'Brien worked at Boston TV station WB 56, and then served three years as CEO of the Girl Scouts of Greater Boston. She was appointed by New York Comptroller Thomas DiNapoli to serve as chair of the Pension Reform Commission from 2008 to 2010. She's also worked with health care, clean energy, financial services and telecommunications companies through her O'Brien Advisory Group.

Goldberg picked O'Brien for the chair position in late August 2022. She followed interim Chair Sarah Kim and inaugural commission Chair Steven Hoffman. The treasurer is responsible for appointing someone with a financial background to chair the marijuana industry regulatory body.