A California appeals court on October 13, 2026 upheld the dismissal of fraud and unfair competition claims brought by a customer who said a salesperson at the Purple Lotus cannabis store in Santa Clara County sold him a 10mg THC gummy as a way to ease anxiety without getting high, holding that he never pleaded facts showing she knew her advice was false.

In Short

A man bought a cannabis gummy after a store worker told him it would calm his nerves and not make him high, and he says it caused a panic attack and years of health problems. He sued the store for fraud, but the court said fraud means lying on purpose, and he gave no facts showing the worker knew she was wrong. The judges kept the case dismissed, so bad advice that a seller believes is true is a different legal problem from deliberate deception, and in this case the deadline for that other claim had already passed.

The ruling

The Court of Appeal of the State of California, Sixth Appellate District, filed its opinion in Deen v. VMK, Inc. (case H053576) on October 13, 2026. Justice Adams wrote the opinion, with Presiding Justice Greenwood and Justice Lie concurring. The appeal came from Santa Clara County Superior Court case 23CV410398, where the trial court had sustained a demurrer without leave to amend - meaning it dismissed the complaint and refused to let the plaintiff try again.

The judgment was affirmed. VMK, as the prevailing party, is entitled to its appellate costs under California Rules of Court, rule 8.278(a).

The opinion is not certified for publication. Under California Rules of Court, rule 8.1115(a), courts and parties are prohibited from citing or relying on it in other cases, except in limited circumstances. It sets no binding precedent. What it does offer is a detailed account of how California courts separate a salesperson's mistaken product claim from actionable fraud, and why that distinction decided this case.

What the customer alleged

According to the operative second amended complaint, as summarized by the court, plaintiff Nasir Abbas Deen went to the Purple Lotus, a California licensed cannabis retailer operated by VMK, to buy something that would relieve anxiety stemming from a dental procedure. He asked a salesperson, identified in the opinion as E. Franco, for "a quick, safe, and natural way" to relieve that anxiety. He told her he had never used cannabis or any other recreational drug and did not want to get "high" or feel intoxicated.

Franco recommended an edible gummy containing 10mg of Delta-9-tetrahydrocannabinol (THC). According to the complaint, she told him to take half of the gummy, and to take the other half if he felt nothing after an hour. Deen later learned, the complaint says, that THC is known to cause intoxication and a "high" for up to 6 to 12 hours. He also alleged that he was not asked to sign a liability waiver that the store typically provided to first-time users to inform them of the risks of cannabis and THC.

The consequences he described were severe. After taking the gummy, according to the complaint, he had a six-hour panic attack and went to a hospital emergency room for visual hallucinations, paranoia, anxiety, depression, dissociation, derealization and depersonalization. In the months and years that followed he reported continued anxiety, depression, sleeplessness and migraines. He was involuntarily hospitalized after hearing voices, and was later diagnosed with bipolar disorder, generalized anxiety disorder and major depression. The complaint lists ongoing physical symptoms including migraines, tics, tremors, muscle spasms and "a sharp pulsing sensation inside his brain."

None of those facts were tested on their merits. At the demurrer stage, a court assumes the truth of factual allegations and asks only whether they state a legal claim. The case ended on that question.

How the claims were narrowed

The case was already smaller than Deen wanted before it reached the demurrer. After filing his original complaint, he moved to add causes of action for medical malpractice, negligence, negligent misrepresentation, fraud, breach of the implied covenant of good faith and fair dealing, intentional infliction of emotional distress, and unfair competition under Business and Professions Code section 17200. The trial court asked for additional briefing on the statute of limitations, then allowed him to add only two: fraud and unfair competition. A motion for reconsideration was denied.

That sequence matters for everything that followed. Negligence-type theories were off the table. Only intentional fraud, and an Unfair Competition Law claim built entirely on that fraud, remained.

VMK filed a general and special demurrer, arguing that the complaint was uncertain and that Deen had not alleged facts on the falsity and intent elements of fraud. Deen responded that Franco's statements were reckless and that complaints are liberally construed at this stage.

The trial court disagreed. It found that the facts alleged did not show Franco intended to deceive him and, at most, stated a claim for negligence. According to the opinion, the trial court wrote that "the fact that Plaintiff's anxiety actually increased does not lead to the inference that Franco knew the gummy would lead to increased anxiety at the time she told Plaintiff it would decrease his anxiety and intended to deceive Plaintiff into buying the gummy based on that representation." It concluded: "Thus, at most, this is a case of negligent misrepresentation for which the statute of limitations ran by the time Plaintiff filed this lawsuit."

The trial court also compared the situation to a medical case in which complications arise from low-probability risks a physician did not disclose. It found that the conclusory claim that VMK "should have known" its representations were false, simply because it runs a cannabis dispensary, did not satisfy the knowledge element of fraud.

Why fraud failed: knowledge of falsity

The appeals court reviewed the complaint de novo and reached the same result on the same core ground. Under California law, as the opinion sets out, intentional misrepresentation requires seven elements, including that "the defendant knew that the representation was false when the defendant made it, or the defendant made the representation recklessly and without regard for its truth." Every element of fraud must be pleaded with particularity. The usual rule that pleadings are read generously does not apply. A plaintiff must allege "how, when, where, to whom, and by what means" the representations were made.

The court identified the principal issue as whether the complaint contained particular facts sufficient to establish knowledge of falsity. It found none.

Deen's complaint said Franco "knew that the representations were false" and acted "with a reckless disregard for the plaintiff's safety." The court held these were bare conclusions, not facts, and not entitled to an assumption of truth. "Indeed, there are no supporting facts in the complaint explaining why or how Franco or defendant would have known that the alleged representations regarding the cannabis gummy and its suitability to plaintiff's medical needs and preferences were untrue," the court wrote.

There was a second, narrower problem with the wording. Fraud turns on reckless disregard for the truth of a statement, not reckless disregard for the plaintiff. Citing Engalla v. Permanente Medical Group, Inc. (1997), the court said "it is reckless disregard for the truth, not the plaintiff, that matters for a claim based on intentional fraud."

The dispensary argument

Deen's more specific theory was that VMK should have known the statements were false because it is "a dispensary that dispenses products to those who want to get intoxicated from their dispensary license, not a medical patient center." The complaint went on to allege that the business "continued to market their products are safely lab tested for therapeutic benefits to continue to deceive customers thinking THC has health properties when it really has risks and does not meet medical standards according to the FDA."

The court read that allegation as cutting the other way. The inference to draw from it, according to the opinion, is that Franco "made a healthcare recommendation without the requisite qualifications or training; in other words, that Franco was not a medical professional and had no reasonable grounds to make the recommendation." That describes someone speaking without a reasonable basis, which is the territory of negligent misrepresentation. It does not show that she believed her statements were false when she made them.

To draw the line, the court relied on Anderson v. Deloitte & Touche (1997), in which investors sued an accounting firm over forecasts in an offering memorandum. That court held there was no evidence the firm made its representations knowing they were false, and characterized the investors' complaint as alleging that the firm "didn't do its homework. This constitutes a claim of negligent misrepresentation rather than an intent to deceive, which is the basis of actual fraud." The Sixth District applied the same logic to a cannabis sales counter.

The opinion quotes another line that captures the doctrine: "Where a defendant makes false statements, honestly believing them to be true, but without reasonable grounds for such belief, he may be held liable for negligent misrepresentation," but not for fraud based on intentional misrepresentation.

One detail in the opinion's own citations does not line up. Anderson is first cited as 56 Cal.App.4th 1468, but later pinpoint citations to the same case refer to "6 Cal.App.4th." The case name, year and reasoning are consistent throughout, so the second form appears to be a typographical slip in the opinion rather than a reference to a different decision.

Opinion or fact?

VMK had also argued that Franco's statements were nonactionable opinion. The trial court rejected that argument because VMK held itself out as possessing superior knowledge. The appeals court declined to decide the point at all. Since the complaint failed on knowledge of falsity, there was no need to reach whether "it's supposed to make you relax" is a statement of fact or a view. For retailers whose staff routinely describe effects of consumable products, that question stays open in this case.

The evidence the court would not consider

On appeal, Deen tried to fill the gap with materials he had not submitted in opposition to the demurrer. He asked the court to take judicial notice of two documents: a declaration from his private investigator stating that Franco said in a phone interview that VMK "didn't really train us," and what he called "Matts contradictory deposition testimony under oath denying dosing instructions." The court surmised the second referred to the deposition of VMK's chief executive, Mathew Krishnamachari.

The court denied the request. Judicial notice, it explained, is meant for matters reasonably beyond dispute, and appellate courts generally do not notice evidence that was not presented to the trial court except in exceptional circumstances. The documents had been filed with other motions, not with the demurrer opposition, and Deen had not told the trial court he could amend his fraud claim based on them. The court said he cited no authority for the idea that a trial judge must search the docket for documents filed with unrelated motions.

Even on their substance, the documents did not help. Statements that contradicted the alleged misrepresentations did not explain why Franco knew her own statements were false at the time she made them.

The court also examined an exhibit that Deen said contained 22 "documented incidents" showing "reckless intent to deceive in Franco's write-ups." According to the opinion, those records documented her dismissal for "poor work performance, poor attendance," failing to wear a mask during the pandemic, talking on her cell phone, and needing "to be asked to stay busy instead of standing around talking." None, the court found, referred to any instance in which Franco gave incorrect information to customers about the effects or dosage of cannabis products.

Litigation conduct and a case that does not exist

Deen also argued that VMK's conduct during the litigation showed consciousness of guilt and therefore scienter. In support, according to the opinion, he cited "People v. Sokolow (1993) 12 Cal.App.4th 347." The court stated plainly that this is "a case that does not exist."

He also cited Engalla and Oregel v. American Isuzu Motors, Inc. (2001) for the idea that fraudulent intent may be inferred from patterns of misconduct and document falsification. The court said both were inapt: neither endorsed the premise that a defendant's behavior during litigation can show it knew, before the complaint was filed, that its earlier statements were false. In a footnote, the court added that the citation Deen gave for Oregel in both his opening and reply briefs was incorrect, and that it had substituted the correct one.

The opinion does not say how the nonexistent citation came to be in the brief, and it does not mention artificial intelligence. Fabricated case law has nonetheless become a recurring feature of court filings since generative tools began producing plausible but invented authorities, a pattern known as hallucination. In August 2025, a federal court in Arizona sanctioned a lawyer after only five to seven of 19 case citations in a brief turned out to exist and support the cited propositions. That same month, a Florida magistrate judge ordered former Bang Energy chief executive John Owoc, representing himself, to perform 10 hours of community service over 11 fake citations. Here, the court imposed no sanction; it simply noted the citation and moved on.

The court's patience with procedural defects was visible elsewhere. Deen's opening brief contained no citations to the record, which violates California Rules of Court, rule 8.204(a)(1)(C). The court said self-represented litigants are not exempt and that it could have treated all of his contentions as forfeited. It considered the appeal on its merits anyway.

Why the unfair competition claim fell with it

The Unfair Competition Law prohibits "any unlawful, unfair or fraudulent business act or practice." The opinion quotes Beverage v. Apple, Inc. (2024) for its purpose: to protect "both consumers and competitors by promoting fair competition in commercial markets for goods and services." Under the fraudulent prong, a plaintiff must show that members of the public are likely to be deceived, the standard set out in Kasky v. Nike, Inc. (2002).

Deen said his UCL claim was "predicated entirely on the fraud allegations." That tied its fate to the fraud claim. Because the fraud allegations were deficient, and Deen identified no other allegations that could support a fraudulent-practices claim, the UCL count failed too.

The court addressed one further theory: that VMK fabricated training documents and falsely asserted the existence of safety protocols. Even if true, the court said, Deen would have to allege that he relied on those practices when he bought the gummy. "But plaintiff admits he only discovered this conduct through discovery after initiating this case," the court wrote. Something a customer learned about after the purchase cannot have induced the purchase.

That reliance requirement is a routine but frequently decisive part of California consumer cases, including the label and advertising suits PPC Land has followed. The Liquid Death complaint over a "0g sugar" energy drink, filed in August 2026, pleads UCL, False Advertising Law and Consumers Legal Remedies Act counts built on what shoppers saw on the can. The Black Rifle Coffee class action over American origin claims, filed in November 2025, pleads all three UCL prongs alongside similar statutes. Deen's case was different in kind: an in-person, one-to-one sales conversation rather than a printed claim, and a pleading that rested on what a single employee knew.

Leave to amend

The final question was whether the trial court should have let Deen try again. Review here is for abuse of discretion, and the burden sits with the plaintiff to show a reasonable possibility that the defects can be cured. "The assertion of an abstract right to amend does not satisfy this burden," the court said, quoting Rakestraw v. California Physicians' Service (2000).

The trial court's written order recorded that when Deen was asked at the hearing what additional facts he could allege, he did not identify any and insisted the second amended complaint was adequate. No reporter's transcript of that hearing was included in the appellate record.

On appeal, Deen proposed several new theories, including perjury, document fabrication and obstruction of justice, but focused on constructive fraud. Constructive fraud, the court explained, "is a unique species of fraud applicable only to a fiduciary or confidential relationship." Deen did not set out the applicable law or allege facts showing that he and VMK had such a relationship. A retail purchase of a gummy does not create one on these pleadings. The court found no abuse of discretion.

The procedural path

The record shows a messy route to the appeals court. Deen appealed from the order sustaining the demurrer before judgment was entered. VMK moved to dismiss the appeal on that basis. The court denied the motion and, on its own motion, treated the premature appeal as filed on the date judgment was entered. As a general rule, an order sustaining a demurrer without leave to amend is not itself appealable, but where every cause of action is disposed of, appellate courts may treat the order as incorporating a judgment of dismissal.

After the demurrer ruling, Deen also opposed VMK's proposed judgment of dismissal and sought reconsideration based on what he described as new evidence and litigation misconduct. The court treated the entry of judgment as an implied denial of that request. It said it could not assess his claim that the trial court ignored evidence of fabricated training documents, because the record contained no reporter's transcript or settled statement of the reconsideration hearing.

Why this matters beyond one dispensary

On its face this is a narrow, unpublished state-court ruling about one customer, one product and one conversation. Its relevance for marketers lies in the line it draws and in how much depended on timing.

The court did not hold that Franco's advice was accurate, appropriate or harmless. It did not decide whether a statement that a THC product will help with anxiety is a factual claim. It held only that a fraud claim needs facts showing the speaker knew, or recklessly disregarded, that the statement was false. Claims of carelessness, inadequate training or unqualified health advice point toward negligent misrepresentation instead. In this case, according to the trial court's reasoning that the appeals court left in place, that negligence-type claim was already time-barred.

Cannabis advertising sits under heavy restrictions on most major platforms, which shifts more of the sales conversation to the store counter and the retailer's own website. Google has tested limited changes only outside the United States, opening a Search-only pilot for federally licensed cannabis operators in Canada on August 25, 2025 and extending it to authorized government operators on October 15, 2025. In that environment, what budtenders say and how dispensary sites describe "therapeutic benefits" carries much of the marketing load. Deen's complaint targeted both, but it never connected the website language to his purchase decision.

There is also a contrast with how platforms and regulators handle health-adjacent claims. Ad policies and consumer protection statutes often apply objective standards to claims, regardless of what the seller believed. Common-law fraud, as this opinion shows, turns on what the speaker knew. A retailer whose staff sincerely repeat inaccurate claims may avoid a fraud judgment while still facing other forms of liability, if the claims are brought in time and pleaded under the right theory.

The case also adds to a small but growing body of opinions in which courts flag citations that do not exist. The Sixth District did not speculate about the cause. It recorded the error in one sentence, corrected another citation in a footnote, and decided the appeal on the merits.

Timeline

Summary

Who: Nasir Abbas Deen, a self-represented plaintiff, and VMK, Inc., operator of the Purple Lotus licensed cannabis retailer, before the California Court of Appeal, Sixth Appellate District (Justices Adams, Greenwood and Lie).

What: The court affirmed dismissal of Deen's fraud and Unfair Competition Law claims over a 10mg THC gummy that a salesperson allegedly recommended for anxiety without a "high," holding that he pleaded no facts showing she knew her statements were false. It denied judicial notice of new evidence, refused leave to amend, noted that one case he cited does not exist, and awarded VMK appellate costs.

When: The opinion was filed on October 13, 2026. The underlying case was filed in Santa Clara County Superior Court under a 2023 case number.

Where: California, in the Sixth Appellate District, on appeal from Santa Clara County Superior Court. The opinion is unpublished and cannot be cited as precedent under rule 8.1115(a).

Why: Fraud in California requires knowledge of falsity or reckless disregard for the truth, pleaded with particular facts. Allegations that a retail employee lacked training or medical qualifications point to negligent misrepresentation, a claim the trial court found time-barred, and a UCL fraud claim built on the same allegations, or on practices discovered only after the purchase, fails with it.