URGENT UPDATE: Vertical Harvest, a hydroponic farm in downtown Westbrook, is facing a lawsuit over allegations of unpaid fees related to a $48.75 million federal loan. The legal action, filed on December 19, 2025, claims that the farm failed to repay $975,000 to its broker, Waterside Commercial Finance.
The suit accuses Raiven Fund Management—a Canadian venture capital firm—and its principal, Paul Dugsin, who chairs the board of Vertical Harvest, of misleading Waterside into deferring payment of the loan proceeds. Waterside is demanding full payment of damages, attorney’s fees, and any other penalties deemed appropriate by the court.
Vertical Harvest, which aims to produce 3 million pounds of leafy greens annually, has received nearly $60 million in financing. After construction delays, the farm is now operational, according to CEO Nona Yehia. In a statement, Yehia emphasized that the lawsuit is a commercial dispute and not indicative of any operational failure. “We are aware of the filing and want to be clear that the claims being asserted are inaccurate and materially misleading,” she wrote.
The lawsuit details that at the loan closing, Vertical Harvest paid Waterside $75,000. In April 2024, both parties agreed on a subordinated note agreement to outline repayment of the remaining $900,000. Under this agreement, the debt would double to $1.8 million if not repaid within eight months, with interest accruing at an annual rate of 25%.
Waterside asserts that it would not have entered the repayment agreement without confirmation from Dugsin that senior lenders approved the terms. The lawsuit claims that Dugsin personally confirmed this approval, making him individually liable, while Raiven is held responsible due to Dugsin’s position.
Additionally, Waterside alleges that Vertical Harvest failed to make payments after receiving over $500,000 in new financing from Raiven in September 2025, which was not disclosed to them.
This legal challenge adds to Vertical Harvest’s financial woes; earlier in 2025, the city of Westbrook filed a lien against the farm for nearly $45,000 in unpaid taxes. Yehia previously stated that the farm was not operating at full capacity during that time, raising concerns about its financial viability.
As this situation develops, all eyes will be on the court’s response and the potential implications for Vertical Harvest’s operations and future funding. Stay tuned for updates on this unfolding story.
