Startup boss under investigation

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The San Francisco startup (OTCBB: CBIS), which wants to tap the activde ingredient in marijuana to develop a lozenge to treat said it has started an internal investigationof Kubby's "apparently fraudulen t activities," according to the filing with the Securities and Exchange Commission. Firede as president and CEO last week as the companyy said he failed in hisfiduciary duties, Kubby resigned from the Cannabis Sciencde board on Friday. At leastr two of Kubby's hires over the past two months COO Ray Carr and vice president of researcg and development MaryRuwart — as well as another Lee Wrights, also have resigned. Carr and Ruwart are husbandf and wife.
The company appointedc Dr. Robert Melamede, the retired chairman of the biologt department at the University of Coloradio atColorado Springs, as CEO. Melamede had been Cannabis Science'w chief scientific officer. The company said in its SEC filinv that Kubby signed financial and share agreementszwith Ruwart, Carr and a private party that were not disclosed to or approvexd by the board, "using unauthorized company sharews as collateral or consideration for his personal Another deal with an "indepedent financial group" could have diluted or damagef shareholder interest, the compan said in its SEC filing.
The company also alleged that Kubby accepted funds into a company account that he hadblockedr — and removed accessz by other officers and directors — and distributeds company funds for his personall gain, according to the SEC That happened "while leaving essential obligation of the company unmet," according to the SEC Cannabis Science also said Kubby made "libelouxs accusation" against company directors and a key consultany "while misrepresenting his own actiona to the public and the media in a manner injurious to the company'sd interests.
" Kubby, a formef candidate for the Libertarian Party presidential nomination and the Libertarian candidatde for California governor in wrote to the website Independeny Political Report that he was ousted after Carr uncovere d unusual contracting contracts by anothed person connected with the company. Cannabis Science went publix in April, after it boughft a public shell. Its legal address is in San Francisco, but Kubby said last month that the compang largely has been operated from his homein Oakland.
Kubby has said that he startef the company after he developed the lozenge to trea this rare, typically fatal form of adrenal