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Fresh lawsuit targets New York’s rollout of adult-use marijuana

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4 months ago

December 22, 2023

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New York regulators are facing yet another lawsuit aimed at stopping them from issuing any additional adult-use marijuana licenses.

The lawsuit – filed in U.S. District Court in the Northern District of New York by two companies seeking retail licenses – comes less than a month after regulators approved settlement agreements in two previous suits that contributed to the tortuous rollout of legal adult-use cannabis sales in the state.

In the new lawsuit, Variscite New York Four and Variscite New York Five argue that the state’s retail marijuana licensing program violates the U.S. Constitution’s dormant commerce clause, which generally prohibits states from passing legislation that discriminates against or excessively burdens out-of-state citizens compared to in-state citizens.

Both companies are 51% owned by a Los Angeles man “who was convicted of a cannabis crime under California law rather than New York law,” the lawsuit claims.

The lawsuit targets the state Office of Cannabis Management and its Cannabis Control Board, according to Spectrum News 1.

The suit was filed the day that the latest licensing round closed, Green Market Report noted.

According to Green Market Report, the suit claims that state residency requirements are unconstitutional and that the two plaintiffs’ applications should have received “extra priority” because they had secured properties for their businesses.

“Because Plaintiffs satisfy every requirement for the ‘extra priority’ pool except the unconstitutional New York residency preferences, Defendants should process Plaintiffs’ applications in the extra priority pool,” according to the lawsuit.

Last November, a company with a name similar to the two plaintiffs in the new lawsuit – Michigan-based Variscite NY One – filed a suit seeking an injunction against the state after unsuccessfully applying for licenses in five New York regions.

That lawsuit prevented retailers from opening across significant portions of the state, Spectrum News 1 noted.

And similar litigation has been filed against other social equity programs elsewhere in the country, including in Los Angeles.

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Cannabis MSO MedMen is exiting Arizona and Nevada

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4 months ago

December 22, 2023

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Marijuana multistate operator MedMen Enterprises is exiting Arizona and Nevada by selling its assets in those states to privately held MSO Mint Cannabis.

The sales are the result of a strategic review by MedMen, according to a news release, and consist of the Los Angeles-based company’s wholly owned operating subsidiary in Arizona and two operational stores in Clark County, Nevada.

The value of the transaction was not disclosed.

Mint Cannabis has operations in its home state of Arizona as well as Michigan and Missouri.

MedMen warned investors in February that the company was running out of cash and later in the month said it was evaluating divesting properties in Arizona, Illinois and Nevada.

In November, MedMen advised that its annual results for the 2023 fiscal year ended July 1 would be late.

“MedMen is pleased with the outcome of our strategic review and has made good progress in our restructuring efforts,” MedMen CEO Ellen Deutsch Harrison said in a statement.

“These transactions will bolster liquidity in the short term, reduce liabilities, and enable the Company to focus on operating efficiencies and executing our long-term asset-light growth strategy in our core markets.”

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New PA law could increase medical marijuana dispensary permits by 20%

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4 months ago

December 22, 2023

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(This story has been updated to clarify the changes in Pennsylvania law.)

Up to 30 new medical marijuana dispensaries could open in Pennsylvania under a bill signed into law by the state’s Democratic governor, a potential expansion of 20%.

Under Senate Bill 773 – which Gov. Josh Shapiro signed into law Dec. 14, as promised – as many as 10 independent MMJ growers now qualify to apply for a dispensary license.

Until now, Pennsylvania law capped the number of dispensary license holders at 50.

That arrangement led to a market controlled by out of state big cannabis company that resembled a near monopoly, according to critics.

The new law:

Could mean an expansion of up to 20% in the number of dispensaries allowed in the state if all 10 that receive approvals apply.
Also allows up to four dispensaries previously barred from cultivating cannabis to begin growing operations.

The changes could help expand product offerings available to MMJ patients in the state, some of whom might be lured to nearby Ohio once adult-use sales begin there as anticipated in 2024.

There’s also new language that would require MMJ license holders to report any change in ownership affecting a stake of 20% or more.

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