Nfld. & Labrador·CBC Investigates

Dean MacDonald firms have same address as mystery company in Canopy Growth deal

Businessman with Liberal ties says "cast of thousands operating out of that building."

Businessman with Liberal ties says 'cast of thousands operating out of that building'

Dean MacDonald steered questions about 80521 Newfoundland and Labrador to Canopy Growth. (Ted Dillon/CBC)

A mystery numbered company that is leasing land to Canopy Growth for a government-supported cannabis production facility shares an address with firms linked to a prominent businessman with Liberal ties.

But Dean MacDonald says there are many businesses operating out of that downtown St. John's location, including Canopy Growth itself, which he says has had office space there since last spring.

MacDonald declined to say whether he has any connection to the numbered company, and steered questions about 80521 Newfoundland and Labrador to Canopy Growth.

He told CBC News there is a "cast of thousands operating out of that building" at 7 Plank Road in downtown St. John's.

It is also home to an advertising agency.

While MacDonald initially took no issue with describing Plank Road as the office address for the numbered company, he sent a text message on Tuesday morning clarifying the situation.

"While the permitting application was filed from Plank Road, it is my understanding that the numbered company's address is elsewhere," MacDonald said. "80521 does not have office space in the building."

City building permits list address

Ownership of the numbered company has been the subject of intense scrutiny in the legislature, but has remained a mystery.

The sole director is a St. John's lawyer, and incorporation documents list the lawyer's office as the numbered company's address.

The Canopy Growth production facility currently being built in St. John's is expected to be operational in 2019. (Ted Dillon/CBC)

But city building permits list a different address for 80521 Newfoundland and Labrador — Suite 301 at 7 Plank Road.

CBC News obtained those documents through an access-to-information request.

The names of people associated with 80521 are redacted, for privacy reasons.

According to public records, at least three of MacDonald's companies — Newfoundland Growlers Inc., Deacon Investments, and Deacon Sports and Entertainment — all have the same Suite 301 address.

Canopy cites concerns about 'U.S. border uncertainty'

Last month, when asked about the shareholders for the numbered company, Canopy Growth told CBC News that it is "unsure of the shareholder structure, it is a private business."

On Tuesday morning, in response to a follow-up inquiry, Canopy vice-president of communications Jordan Sinclair cited potential issues with crossing the American border.

"The team at 80521 Newfoundland and Labrador explained that the U.S. border uncertainty raises concerns for them," Sinclair wrote in an emailed statement.

"The team at 80521 Newfoundland and Labrador explained that the U.S. border uncertainty raises concerns for them. This is a common concern in the cannabis space and as such, we are happy to respect their privacy.- Canopy Growth vice-president Jordan Sinclair

"This is a common concern in the cannabis space and as such, we are happy to respect their privacy."

Questions have been raised about the potential risks for investors and employees in the cannabis industry when travelling into the U.S., where cannabis remains banned under federal law.

As for the numbered company, Sinclair added: "We chose to do business with this group because they are experienced in the local market. With their help in identifying appropriate sites, we're well on our way to creating 400 jobs in the province and investing tens of millions of dollars as we build a world-class production facility."

Political questions over numbered company

Canopy is working to establish a $55-million facility capable of producing 12,000 kilograms of dried cannabis product a year, creating 146 jobs, and ensuring at least 8,000 kilograms of cannabis is available for sale in the province.

In return, Canopy will be able to recoup $40 million of eligible costs through reduced sales remittances to the province.

Workers produce medical marijuana at Canopy Growth Corporation's Tweed facility in Smiths Falls, Ont. Canopy is now building a cannabis production facility in St. John's. (Sean Kilpatrick/Canadian Press)

Last month, CBC News revealed details of the lease arrangement Canopy has with the numbered the company that now owns the land.

The Liberal government says it does not know who owns the numbered company, and it doesn't matter.

But the Opposition Tories have questioned whether politics may have somehow played a role in the Canopy lease arrangement, and called for an investigation by the auditor general.

MacDonald is a long-time Liberal who pondered a run for the leadership of the provincial party in 2012, before opting out of the race.

He called for a party shake-up after the 2011 election saw the Liberals barely cling to official Opposition status.

MacDonald was also a key player in the ensuing Liberal renewal process.

Story raised in the legislature

PC Opposition Leader Ches Crosbie raised those past Liberal ties during question period at the House of Assembly Tuesday afternoon.

"According to media, the permitting application for the numbered company originated in the same suite as three companies owned by an individual by the name of Dean MacDonald, generally assumed to be an individual with Liberal Party connections, in a building where Canopy Growth also has an office," Crosbie said.

"I would ask the premier: How do we refute the suspicion in the public mind that this numbered company is benefiting because of ties to the Liberal Party?"

Innovation Minister Christopher Mitchelmore has said repeatedly government doesn't know who owns the numbered company that is leasing land to Canopy Growth. (Katie Breen/CBC)

Innovation Minister Christopher Mitchelmore was the one to respond.

"We've entered into a contract with Canopy Growth and with Biome to be able to grow an industry here in our province. We have a good business deal. We do not have any relationship with the private business matters that Canopy Growth or Biome or any other company is doing. We have a performance-based contract. I've answered the details," Mitchelmore said.

"The member opposite is bringing in hypotheticals and what-ifs that is irrelevant, and is not part of the conversation of the contract with government."

About the Author

Rob Antle

CBC News

Rob Antle is producer for CBC's investigative unit in Newfoundland and Labrador.