Business
Unlicensed Cannabis Events Prompt Crackdown by City of Denver
While legal social consumption lounges are still preparing to meet operation criteria, the Denver Department of Excise & Licenses is cracking down on unlicensed cannabis events.
The Denver Department of Excise & Licenses is continuing to serve warnings to event organizers who are hosting unlicensed cannabis-related activities. This past weekend on Aug. 19, the Stoner Cinema Pop-Up held an event featuring a cannabis-friendly movie experience featuring Grandma’s Boy (2006). The screening was held at Dreams Aren’t This Good, an event venue (which is also a salsa-making facility). These ticketed events offer free cannabis and novelty joints for attendees, which is paired with popular film screenings such as Half Baked or The Sandlot.
Stoner Cinema Pop-Up has been operating since 2022, and the events are ticketed and private, which organizers told Westword allows them to bypass city laws on social cannabis consumption, which requires a cannabis hospitality license.
The Denver Department of Excise & Licenses manages cannabis licensing, in addition to other licensing for residential rental properties, liquor, security services, alarm permits, and short-term rentals. According to the department, Stoner Cinema Pop-Up and other businesses like it are not allowed to operate events without a license.
Department Eric Escudero told Westword that neither Stoner Cinema Pop-Up or the Dreams Aren’t This Good venue have hospitality licenses, and that they’ve received a letter that’s “the equivalent of a warning letter” for holding unlicensed cannabis-related events. “It is a last resort for the city to take enforcement action,” Escuadero said.
While Denver’s cannabis hospitality rules were implemented in 2017, the city’s Department of Excise & Licenses has only approved one venue and three “mobile lounges” to be licensed and legal hospitality operators.
The licensed venue includes an upscale dining and consumption business, Cirrus Social Club, which is being built where a taekwondo studio once operated. “We’re going after a demographic of people who are not heavy cannabis consumers, but rather the out-and-about social person who’s older than 27,” said Cirrus co-owner, Arend Richard, told Westword. “If a date night for you is dinner and a movie, then it now becomes Cirrus and dinner. You come in, have a lovely sesh with us, and hear the jazz music in the background.”
Cirrus received approval from the Department of Excise & Licenses in March, but the business has not yet opened its doors. In order to open it must pass all inspections included in its operating plan, such as safety and ventilation, but it could take more than a year for those inspections to be conducted and approved. According to Westword, three more cannabis venues (Tetra Lounge, Patterson Inn Hotel, the headquarters of Colorado Cannabis Tours) are awaiting approval for a hospitality license, but are experiencing a pause in progress trying to meet city ventilation requirements.
The Coffee Joint is one exception. While it is the only operating cannabis lounge in Denver, it can only allow consumption of vaporizing and edibles on-site. Because temporary permits do not exist under the hospitality license regulations, this means that legally, Stoner Cinema Pop-Ups can only operate at The Coffee Joint, or one of the three mobile cannabis hospitality license holders. “There are three active licensed mobile hospitality establishment businesses that could potentially provide service to events if they provide the city the required route log and follow the rules as far as the 30-minute limit for parking and allowing consumption at one parking spot,” said Escudero.
In March 2022, Tetra Lounge was approved for a hospitality license, but won’t actually receive the license until all the criteria is met. The business originally opened in 2018 as a “private” cannabis venue, but the term has been the topic of discussion for years. The International Church of Cannabis took the city of Denver to court in 2019 in an attempt to redefine the term “private,” but no significant ruling was made.
In July, nine venues and event owners were targeted by both the Colorado Department of Excise & Licenses and Denver Police Department, who issued citations for permitting unlicensed cannabis consumption or organizing cannabis-friendly events. This included Ant Life, Marijuana Mansion, Rooted Heart Yoga Studio, Vape Loft, Clubhouse Collective, Meta Talent Group, Colorado NORML, and Psychedelic Club of Denver.
“Citations, fines and enforcement activity by the city and county of Denver are always a last resort after every effort has been made to educate businesses about licensing rules and regulations,” Escuadero said last month. “As part of that effort, the city has issued licensing bulletins detailing the rules for marijuana hospitality. This included information about if a marijuana business is conducting commerce, there is a requirement for licensing. We hope businesses that are operating marijuana hospitality without the city and/or state required license will take steps to get licensed.”
The Department of Excise & Licenses first sent out memos to cannabis business owners in January 2022 in regards to unlicensed consumption, however it didn’t begin to enforce this until this summer.
Meanwhile in Nevada, the state’s first conditional cannabis consumption licenses were awarded to Planet 13, Thrive Cannabis Marketplace, and The Venue at SoL Cannabis in June, followed by LA Loung LLC at the end of July.
Source: https://hightimes.com/news/unlicensed-cannabis-events-prompt-crackdown-by-city-of-denver/
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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