Business
Legal Marijuana Handed A Nothing Burger From NY State
Following the chaos of the recreational weed rollout, the government is trying to figure out next steps. But it seems legal marijuana has been handed a nothing burger from NY state with their last rollout for potential cannabis retailers.. With an estimated $3.5 billion in sales at stake along with tax revenue for the state’s every growing budget, the fumble is costly for a significant number of players. And it has been a huge loss for the marijuana industry as a whole.
What was quickly seen as an opportunity was pounced on in the city with the most billionaires globally along with endless big and small entrepreneurs, and hustlers. Seeing a huge amount of cash on the table, players acted in a quickly in a way bureaucrats will never understand.
Embracing a Wild West approach, officials decriminalizated and fumbled licensed legalization of sales. Despite promises and initial outlines where existing medical marijuana dispensaries could switch to recreational and a fair, for government quick liscnese process, the state tossed it all in one stroke. In a vision of equity, officials decided to reserve the first retail licenses for felons and other “justice-involved” individuals. Lawsuits started, the desired licensees struggled to raise capital and over 1,600 unlicensed retail stores opened in NYC. For the small time players, they have set sidewalk card tables parks, selling roll-ups and handmade marijuana edibles, in full view of the police.
The updated systems was rolled out, but has left people confused, dispirited, and disappointed. The Office of Cannabis Management rolled out the previous Conditional Adult-Use Retail Dispensaries (CAURD) program with high hopes. Now, regulators voted to allow the state’s medical marijuana operators to apply for adult-use retail licenses. Multistate operators who have patiently acquired a majority of the state’s 10 registered organization.
“It was more like an orgy of minimalism. While they are getting ready to open the application window on October 4th (notably, originally it wasn’t intended to be a 60-day window, but rolling applications) for most license types (sans on-site consumption and delivery), they refused to address the CAURD program. Other than to suggest that it remains “a priority”, they have offered only some subtle hints in the guidance to the regulations. These include establishing a priority for retail applications which include secured real estate, which will be given priority after the initial 30-days of the 60-day application window have passed (although they do not define what that means). And noting that existing licensees may apply for an additional license so long as they comply with the rules of a two-tier system. The positive news is that these statements can be interpreted as an invitation to current CAURD licensees, many of whom will also meet other Social and Economic Equity (SEE) criteria entitling them to an additional priority.” shares Andrew Cooper, partner at Falcon Rappaport & Berkman LLP, one of the top cannabis law firms.
Unfortunately, there are multiple losers in the state’s unique approach. One is consumer and medical marijuana patients, including veterans. The unlicensed dispensaries are making a mint and overcharging customers due to high demand. Small investors and companies, including those who could be a player in the CAURD, will not have the financial to compete with multi-state and large players. And taxpayers will lose out for years to come as revue it lost to unlicensed dispensaries.
The good news, consumers will continue to find products easily over the next few years. There is even a thriving unlicensed dispensary a few blocks from City Hall.
While New York is awash with billionaires, fashion, food and smarts, common sense seems to be lack for making a good government plan.
Source: https://thefreshtoast.com/cannabis/legal-marijuana-handed-a-nothing-burger-from-ny-state/
Business
New Mexico cannabis operator fined, loses license for alleged BioTrack fraud
New Mexico regulators fined a cannabis operator nearly $300,000 and revoked its license after the company allegedly created fake reports in the state’s traceability software.
The New Mexico Cannabis Control Division (CCD) accused marijuana manufacturer and retailer Golden Roots of 11 violations, according to Albuquerque Business First.
Golden Roots operates the The Cannabis Revolution Dispensary.
The majority of the violations are related to the Albuquerque company’s improper use of BioTrack, which has been New Mexico’s track-and-trace vendor since 2015.
The CCD alleges Golden Roots reported marijuana production only two months after it had received its vertically integrated license, according to Albuquerque Business First.
Because cannabis takes longer than two months to be cultivated, the CCD was suspicious of the report.
After inspecting the company’s premises, the CCD alleged Golden Roots reported cultivation, transportation and sales in BioTrack but wasn’t able to provide officers who inspected the site evidence that the operator was cultivating cannabis.
In April, the CCD revoked Golden Roots’ license and issued a $10,000 fine, according to the news outlet.
The company requested a hearing, which the regulator scheduled for Sept. 1.
At the hearing, the CCD testified that the company’s dried-cannabis weights in BioTrack were suspicious because they didn’t seem to accurately reflect how much weight marijuana loses as it dries.
Company employees also poorly accounted for why they were making adjustments in the system of up to 24 pounds of cannabis, making comments such as “bad” or “mistake” in the software, Albuquerque Business First reported.
Golden Roots was fined $298,972.05 – the amount regulators allege the company made selling products that weren’t properly accounted for in BioTrack.
The CCD has been cracking down on cannabis operators accused of selling products procured from out-of-state or not grown legally:
- Regulators alleged in August that Albuquerque dispensary Sawmill Sweet Leaf sold out-of-state products and didn’t have a license for extraction.
- Paradise Exotics Distro lost its license in July after regulators alleged the company sold products made in California.
Golden Roots was the first alleged rulebreaker in New Mexico to be asked to pay a large fine.
Source: https://mjbizdaily.com/new-mexico-cannabis-operator-fined-loses-license-for-alleged-biotrack-fraud/
Business
Marijuana companies suing US attorney general in federal prohibition challenge
Four marijuana companies, including a multistate operator, have filed a lawsuit against U.S. Attorney General Merrick Garland in which they allege the federal MJ prohibition under the Controlled Substances Act is no longer constitutional.
According to the complaint, filed Thursday in U.S. District Court in Massachusetts, retailer Canna Provisions, Treevit delivery service CEO Gyasi Sellers, cultivator Wiseacre Farm and MSO Verano Holdings Corp. are all harmed by “the federal government’s unconstitutional ban on cultivating, manufacturing, distributing, or possessing intrastate marijuana.”
Verano is headquartered in Chicago but has operations in Massachusetts; the other three operators are based in Massachusetts.
The lawsuit seeks a ruling that the “Controlled Substances Act is unconstitutional as applied to the intrastate cultivation, manufacture, possession, and distribution of marijuana pursuant to state law.”
The companies want the case to go before the U.S. Supreme Court.
They hired prominent law firm Boies Schiller Flexner to represent them.
The New York-based firm’s principal is David Boies, whose former clients include Microsoft, former presidential candidate Al Gore and Elizabeth Holmes’ disgraced startup Theranos.
Similar challenges to the federal Controlled Substances Act (CSA) have failed.
One such challenge led to a landmark Supreme Court decision in 2005.
In Gonzalez vs. Raich, the highest court in the United States ruled in a 6-3 decision that the commerce clause of the U.S. Constitution gave Congress the power to outlaw marijuana federally, even though state laws allow the cultivation and sale of cannabis.
In the 18 years since that ruling, 23 states and the District of Columbia have legalized adult-use marijuana and the federal government has allowed a multibillion-dollar cannabis industry to thrive.
Since both Congress and the U.S. Department of Justice, currently headed by Garland, have declined to intervene in state-licensed marijuana markets, the key facts that led to the Supreme Court’s 2005 ruling “no longer apply,” Boies said in a statement Thursday.
“The Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce,” Boies said.
“Moreover, the facts on which those precedents are based are no longer true.”
Verano President Darren Weiss said in a statement the company is “prepared to bring this case all the way to the Supreme Court in order to align federal law with how Congress has acted for years.”
While the Biden administration’s push to reschedule marijuana would help solve marijuana operators’ federal tax woes, neither rescheduling nor modest Congressional reforms such as the SAFER Banking Act “solve the fundamental issue,” Weiss added.
“The application of the CSA to lawful state-run cannabis business is an unconstitutional overreach on state sovereignty that has led to decades of harm, failed businesses, lost jobs, and unsafe working conditions.”
Business
Alabama to make another attempt Dec. 1 to award medical cannabis licenses
Alabama regulators are targeting Dec. 1 to award the first batch of medical cannabis business licenses after the agency’s first two attempts were scrapped because of scoring errors and litigation.
The first licenses will be awarded to individual cultivators, delivery providers, processors, dispensaries and state testing labs, according to the Alabama Medical Cannabis Commission (AMCC).
Then, on Dec. 12, the AMCC will award licenses for vertically integrated operations, a designation set primarily for multistate operators.
Licenses are expected to be handed out 28 days after they have been awarded, so MMJ production could begin in early January, according to the Alabama Daily News.
That means MMJ products could be available for patients around early March, an AMCC spokesperson told the media outlet.
Regulators initially awarded 21 business licenses in June, only to void them after applicants alleged inconsistencies with how the applications were scored.
Then, in August, the state awarded 24 different licenses – 19 went to June recipients – only to reverse themselves again and scratch those licenses after spurned applicants filed lawsuits.
A state judge dismissed a lawsuit filed by Chicago-based MSO Verano Holdings Corp., but another lawsuit is pending.
Source: https://mjbizdaily.com/alabama-plans-to-award-medical-cannabis-licenses-dec-1/
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