A group of licensed medical cannabis operators in New York has filed a lawsuit against the state’s cannabis regulator for overstepping its authority and subverting the intent of the recently enacted Marihuana Regulation and Taxation Act (MRTA). The Coalition for Access to Regulated & Safe Cannabis claims that the Cannabis Control Board and Office of Cannabis Management have put in place policies that were detrimental to promoting social equity and made it more difficult for licensed operators to enter the market.
According to the coalition, the MRTA required the OCM and CCB to open the initial adult-use retail dispensary license application period to all candidates at the same time. However, instead of following this directive, the regulatory bodies created a program called the Conditional Adult-Use Retail Dispensary (CAURD) program that effectively created a new license class and gave select individuals access to the market. This move, the coalition claims, has delayed the availability of safe and regulated cannabis products for medical patients and adult-use consumers in New York state.
The CAURD program, which was introduced in March 2021, was intended to grant the first licenses to individuals with prior cannabis-related convictions that occurred in New York state. However, some applicants have challenged the program, arguing that it conflicts with the US Dormant Commerce Clause, which prohibits states from discriminating against interstate commerce.
The lawsuit is the latest development in a fraught regulatory environment for cannabis operators in New York. The state’s cannabis market has been in a state of flux since the MRTA was passed in March 2021, with confusion and delays plaguing efforts to establish a functioning legal cannabis industry. The MRTA was intended to create a regulated and legal market for cannabis in the state, including provisions for social equity that would help individuals who were disproportionately affected by drug prohibition to enter the industry.
However, the implementation of the MRTA has faced significant challenges. In particular, there have been disputes over licensing, with some segments of the industry arguing that the process has been too slow and not transparent enough. The creation of the CAURD program, which effectively gave licenses to a select group before others, has exacerbated these concerns and caused many applicants to question the legitimacy of the licensing process.
The lawsuit filed by the Coalition for Access to Regulated & Safe Cannabis is an attempt to address these issues by challenging the regulator’s actions and holding it accountable for failing to comply with the MRTA. The group argues that the CAURD program goes against the spirit of social equity provisions by creating a system that favors certain individuals over others.
The lawsuit is likely to attract significant attention, as the cannabis industry in New York is a rapidly growing and lucrative market. According to estimates, the legal cannabis market in the state could be worth over $7 billion by 2027, making it one of the largest cannabis markets in the US. However, for the industry to thrive, it is necessary to establish a regulatory framework that promotes fairness and transparency.
The Coalition for Access to Regulated & Safe Cannabis hopes that its lawsuit will help to achieve this goal by highlighting the importance of following the provisions of the MRTA and promoting social equity in the cannabis industry. The group argues that the failure to do so undermines the integrity of the entire industry and creates an unfair playing field for licensed operators.
Overall, the lawsuit represents a critical moment for the cannabis industry in New York, and it will be closely watched by operators, regulators, and consumers alike. For the industry to succeed, it is necessary to establish a regulatory environment that promotes fairness, transparency, and social equity. The lawsuit filed by the Coalition for Access to Regulated & Safe Cannabis is an important step towards achieving this goal, and it is likely to have significant implications for the future of the cannabis market in the state.
