New York Halts Dispensary Licenses Amid Lawsuit Over Cannabis Equity

Licenses for new dispensaries in New York were halted on Monday, August 7th, 2023 due to a lawsuit filed last week against the state Cannabis Control Board and the state Office of Cannabis Management (OCM) (1). Dispensaries that were already issued licenses are being blocked from receiving operational approval (1). The lawsuit, filed by four service-disabled veterans, claimed the licensing program used by regulators does not align with the program set forth by the Marijuana Regulation and Taxation Act (MRTA) (2).

Under the program used by the OCM, priority for licensing is given to individuals with prior cannabis convictions as opposed to the social equity groups set forth in the MRTA (2). The four veterans would qualify under the state law, which also included minority-owned businesses, women-owned businesses along with communities historically affected by disproportionate cannabis enforcement (1).

“The Office of Cannabis Management is aware of the court’s order, and is adhering to its requirements,” said Trivette Knowles, an OCM spokesperson (3). “We are actively communicating with CAURD [Conditional Adult Use Retail Dispensary program] applicants and provisionally approved licensees to inform them of the impact of the Court’s order on OCM operations.”

The MRTA was signed into law in March 2021 and created a process for license and tax revenue distribution, expunged minor prior cannabis convictions, and also allowed home cultivation for recreational use (4). Medical cannabis was legalized in the state in 2014 (4).

Currently there are around 20 legal dispensaries operating in the state and hundreds operating illegally (1,3).

The judge issuing the stated in his order “that there is genuine urgency and that immediate and irreparable injury, loss, or damage will result” if the licensing program moves forward,” (1). A hearing for the case is planned for Friday, August 11th (1).

Two other lawsuits have been filed against the OCM, one late last year and one in April 2023 (2).

References

1. Zhang, M. New York Cannabis Dispensary openings halted by court order https://www.politico.com/news/2023/08/07/ny-court-halts-cannabis-dispensary-openings-00110182 (accessed Aug 8, 2023).
2. Lewis, C. No new dispensaries: Judge pauses rollout of NY’s legal cannabis industry https://gothamist.com/news/no-new-dispensaries-judge-pauses-rollout-of-new-york-legal-weed-cannabis-industry (accessed Aug 8, 2023).
3. Christmann, S. Another lawsuit puts a hold on cannabis dispensary openings https://buffalonews.com/business/local/new-york-cannabis-dispensary-lawsuit/article_773297f2-35f1-11ee-a548-bb852b09be66.html (accessed Aug 8, 2023).
4. Norml. New York: Governor signs adult-use legalization measure into law https://norml.org/news/2021/04/01/new-york-governor-signs-adult-use-legalization-measure-into-law/ (accessed Aug 8, 2023).