Business
New York Supreme Court Judge Lifts Injunction for Small Number of Cannabis Licenses
Only 30 cannabis licenses are now free to proceed after a temporary halt, but more than 400 are still forced to sit and wait.
New York Supreme Court Justice Judge Kevin Bryant recently lifted a temporary injunction that previously halted approval for any state cannabis licenses on Aug. 25. However, only 30 licensees are currently affected by the decision compared to the statewide total of more than 400 applications that are still on hold.
“As such, those licenses identified by the office of cannabis management will be deemed exempt from the injunction,” Bryant said about his decision.
Those 30 licensees were labeled “ready to open” by both the Cannabis Control Board and the city in which they will operate. According to a PIX11 news report, applicants could potentially become exempt from the injunction if they need their dispensary income to help them financially. “The Judge’s August 18 order outlined certain factors and our job as attorneys representing CAURD licenses is to ensure that our clients are protected and that they fit within an exemption so we need to work to make sure they’re in line with the judge’s order,” said Conditional Adult-Use Retail Dispensary (CAURD) attorney Jorge Luis Vasquez.
In response to Byrant’s most recent decision, the Office of Cannabis Management issued a statement regarding exemptions for those provisional licensees. “While today’s ruling is a disappointment, we are committed to working with the Cannabis Control Board to find a way forward that does not derail our efforts to bring the most equitable cannabis market in the nation to life.”
The lawsuit began on Aug. 2 when a group of military veterans introduced a lawsuit against the Office of Cannabis Management (OCM) and New York Cannabis Control Board, claiming that those agencies did not set up a properly working cannabis industry as stated in the state’s CAURD license, state officials prioritized “justice involved” applicants over disabled veteran applicants.
The Marijuana Regulation and Taxation Act was originally signed in March 2021 by former Gov. Andrew Cuomo, and includes a list of five “social and economic equity” groups that would receive priority for a cannabis license: distressed farmers, individuals who live in areas disproportionately impacted by the War on Drugs, minority-owned businesses, service-disabled veterans, and women-owned businesses.
The lawsuit includes Carmine Fiore (who served eight years in the Army and National Guard), Dominic Spaccio (who spent six years in the U.S. Air Force), William Norgard (a former Army veteran), and Steve Mejia (with six years spent in the Air Force), who are represented by attorneys Brian Thomas Burns, Selbie Lee Jason, and Patrick Joseph Smith, of Clark Smith Villazor.
According to plaintiff Fiore, he and other veterans helped get cannabis legalized, but now are being denied an opportunity to take part in the state’s legal industry and “cast aside for a separate agenda,” Fiore told CBS News.
“From the beginning, our fight has always been for equal access to this new and growing industry,” a joint statement from all four veterans said. “We look forward to working with the state and the court to open the program to all eligible applicants.”
As a result, Judge Bryant issued an injunction on Aug. 7 that prevented the New York Office of Cannabis Management from approving licenses for any new cannabis stores temporarily. In a hearing on Aug. 18, Bryant extended the injunction and said that the CAURD program is in “legal jeopardy,” and predicted that the OCM’s decision not to award licenses to the veteran defendants caused “irreparable harm.”
Clark Smith Villazor released a statement on LinkedIn in response to Bryant’s decision last week. “In a ruling today in favor of Clark Smith Villazor LLP’s four service-disabled veteran clients seeking to enter New York’s nascent retail marijuana industry, a New York State Supreme Court Justice issued a preliminary injunction that largely halts the processing of allegedly unconstitutional conditional adult-use retail dispensary (CAURD) licenses in the cannabis industry,” the firm wrote about the ruling on Aug. 18. “In a 16-page decision, Justice Kevin Bryant found that CSV’s clients ‘presented persuasive and compelling authority’ that the state regulators ‘failed to follow the clear language of the applicable legislation’ by failing to open the retail-dispensary application period to everyone at the same time, including to priority groups like service-disabled veterans.”
Currently, only 23 licensed cannabis stores are open for business in New York, and the decision has halted all progress and is negatively impacting cannabis owners across the state.
Last week, CEO of CONBUD, Coss Marte told High Times how prior to cannabis legalization in New York, 94% of cannabis-related arrests included Black and Latino residents. “We’ve paid our dues. We’ve done the time, and if there’s one thing we hope for the world and the court to know, it’s that like cannabis, we’re here for good and we are here to stay,” Marte said. “We had the opportunity to be heard and to fight on behalf of all of our fellow CAURD licensees who will experience irreparable harm if they’re barred from operating their businesses, and we are confident and hopeful that the court wants a swift resolution that honors the original promises made to justice-impacted license holders.”
The Cannabis Control Board is set to hold a meeting on Sept. 12 to vote on state licensing regulations. “I want this to be as easy as possible, I don’t want to waste unnecessary time,” Bryant said, who also scheduled the next hearing of the case for Sept. 15.
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/
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.”
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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