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New York’s Cannabis Retail Dispensary Regulations, Part 2: Security and Surveillance

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Welcome to Part 2 in this series on New York’s cannabis retail dispensary regulations, covering security. In Part 1, we covered the rules around dispensary operations.

As we also previously summarized, on Friday, October 28, 2022, the Office of Cannabis Management (OCM) released its “Guidance for Adult-Use Dispensaries” (the Regulations). The Regulations are promulgated to provide guidance for Conditional Adult-Use Retails Dispensary (CAURD) licensees and applicants. Last week, at a hearing with the Cannabis Control Board, it was announced that 36 CAURD applicants were granted a license.

The information contained in the Regulations is a mix of substantive requirements, operational guidance and insight into the OCM’s plans for the issuance of licenses and operation of New York’s cannabis industry. As part of our series explaining and detailing the Regulations, this post provides licensees with guidance on the security measures and systems that must be operational in the premised utilized as a retail dispensary. Of course, this post cannot go into each and every mundane detail of the Regulations. Instead, it should serve as a basis for your knowledge going forward and as usual, we encourage you to review the Regulations and consult with an attorney.

Security measures

Licensees must implement

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Will the Senate Ever Do Anything with the SAFE Banking Act?

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As we’ve written about over the past several years, there have been consistent rallying cries for common-sense banking reform for the cannabis industry.

The SAFE Banking Act, which would allow federally regulated financial institutions to work with state-legal cannabis businesses, has been passed by the U.S. House of Representatives a whopping seven times. However, the Senate has yet to take up the SAFE Banking Act, ever – despite the fact that it’s sponsored by Senator Jeff Merkley and has 42 co-sponsors.

The ICBA letter

The Independent Community Bankers Association (“ICBA”) is now urging Senate Majority Leader Chuck Schumer (D-NY) and Minority Leader Mitch McConnell (R-KY) to do something with the bill by the end of the year, in this lame duck session of Congress. The letter penned by the ICBA and 44 state banking associations states:

This legislation enjoys strong, bipartisan support, would resolve a conflict between state and federal law, and addresses a critical public safety concern. We urge its enactment without further delay … The Act would create a safe harbor from federal sanctions for financial institutions that serve cannabis-related businesses (CRBs), as well as the numerous ancillary businesses that serve them, in states and other jurisdictions where

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Washington Cannabis Update: Non-CBD Cannabinoid Additives

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The Washington State Liquor and Cannabis Board (“LCB”) has clarified what cannabinoid additives are allowed in Cannabis products in WA. The LCB recently published a notice that it had adopted interpretive statement IS22-01, “Use of Additives in Authorized Cannabis Products”. The adopted policy statement clarifies that non-cannabidiol (“non-CBD”) cannabinoids may be added to cannabis products in WA if they have been produced by or purchased from an LCB-licensed processor or processor within the I-502 (adult-use statute) system.

Cannabinoids

The cannabis sativa plant produces over 100 cannabinoids, not all of which have psychoactive or intoxicating effects. The two most common cannabinoids are delta-9-tetrahydrocannabinol (“THC”) and cannabidiol (“CBD”). THC is the cannabinoid that has psychoactive effects resulting in users getting “high”, while CBD is not considered psychoactive and is used for a variety of purposes including as an FDA approved treatment for epilepsy (Epidiolex).

The Revised Code of Washington (“RCW”) chapter 69.50.326 already allows for the addition of CBD to cannabis products, but in 2020 the LCB became aware of other cannabinoids being added to cannabis products and has sought to provide guidance on the matter ever since.

Legalization of recreational cannabis in the many U.S. states has led to the development

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Three Ways To Protect New Cultivars

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Many cannabis companies spend significant resources developing new cannabis cultivars or refining popular strain genetics. As they do so, more and more are looking for strategies to protect those investments. Plant patents for purportedly novel cannabis plants are increasingly common, but are plant patents really the best way to protect cannabis genes?

In addition to traditional security measures, there are 3 types of intellectual property available that may be used to protect new cannabis strains: (1) plant patents, (2) utility patents, and (3) the Plant Variety Protection Act. Each option has its own set of benefits and comes with its own particular registration requirements.

Plant patents for cannabis genes

Plant patents are one potential option to protect a newly invented cannabis cultivar. Plant patents can protect new plant varietals that are capable of asexual reproduction.

Cannabis is typically a sexually reproducing plant: both male and female versions can contribute genetic material to offspring (but only female plants produce the cannabinoid-rich flowers in which most people are interested).

Cannabis plants, however, are also relatively easy to reproduce asexually via cloning or cutting. Newly created cannabis strains, whether created accidentally or by intentional crossbreeding, may be therefore eligible for a plant patent

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