High Stakes Poker legend, tournament crusher… cannabis investor? Phil Ivey has led a life that is as unique as it is bizarre, and that life took another twist this week as the top 10 poker player of all time saw his potential investment in a cannabis company go up in smoke.
How much has Ivey lost, and how? The story is one that under any circumstances, might make anyone hearing it believe the alleged perpetrators have been testing their own product a little to excess.
What Did Phil Ivey Invest In?
“Ivey had ‘significant business experience and financial resources’.”
Phil Ivey has maintained an element of mystique around his entire poker career, which in these days of social media sharing is some feat all on its own. His latest escapade does in fact date back to 2014, so holds little relevance to today’s Phil Ivey, as he will have financially recovered from any setback the encounter caused. Despite that, however, a court case goes on as the bankruptcy suffered by the company is something Ivey believes he should be recompensed as a result of.
The company in question, called NuVeda LLC, were already being sued for $5 million back in 2020 by an affiliate of the California-based cannabis dispensary chain Urbn Leaf. NuVeda, based in Delaware, has clearly encountered problems, but in such a growth-related industry — pun intended or not — how has that happened?
Ivey’s own lawsuit was filed in June 2020, setting himself against NuVeda for money owed from a business loan and an equity stake in the company, believed to be as little as 3% for almost $2 million. That valued the company at over $66 million back in 2014, something that clearly never transpired to be the truth.
The lawsuit described how Ivey’s “significant business experience and financial resources” helped NuVeda structure their business strategy and “provide proof of financial viability… including the amount of taxes paid”.
How Much Could Ivey Have Lost?
Ivey is a Poker Hall of Famer, a 10-time WSOP bracelet winner and one of poker’s biggest names, so why was he given only 3% of the company for an astronomical amount of money. Ivey, listed as an approved owner by the State of Nevada on NuVeda’s half-dozen licenses, paid the lion’s share of $2 million for that privilege, but another co-plaintiff, Shane Terry, was told that his 23% interest in the company was only going to be worth $1.75 million. By Ivey’s investment, the poker legend’s share of the pie – which never materialized – would have been worth around $15m.
Whatever the value of company shares, the money was apparently seized by co-owners Pejman Bady and Pouya Mohajer without the written consent of the plaintiffs, leading to the court case now occurring. Whether Ivey and the others will ever see their money is doubtful, but Terry – who received $250,000 for his shares – may well have been paid with money taken from Ivey or others before the company financially smoked itself into the ground.
Both Bady and Mohajer still co-own NuVeda and its subsidiary companies, which include two dispensaries named The Sanctuary, with one store in Downtown Vegas and another in the North of the city a stone’s throw from the Hacienda nightclub. NuVeda’s filing for Chapter 11 bankruptcy is what is making it look increasingly unlikely Ivey will even see a return on his investment.
Will Ivey Get Anything Back?
The bankruptcy filing means that the lawsuit has to come to an immediate end, with the company looking highly likely not to be able to make any significant payments. With a list of creditors lining up to claim a refund on their monetary investments, NuVeda’s bankruptcy documents see the company claim to have only $50,000 to their names.
With between $1 million and $10 million in liabilities, NuVeda look increasingly unlikely ever to see their way to repaying Phil Ivey on the $1.9m he may be invested in their company for. With his recent wins in Cyprus, both in the Super High Roller Series and Triton Poker Series making up over $2 million in tournament winnings, Ivey may not be as concerned from a financial basis.
As a shrewd business investor, however, this recent misstep on Ivey’s part – or rather the owners of NuVeda – shows that no matter what a poker player invests in, there is never any guarantee of a return, no matter how ‘high’ the profits may be spoken about heading.
