A New York-based coalition has accused the state’s Office of Cannabis Management and Cannabis Control Board of “unconstitutional overreach” in its management of the state’s legalized cannabis effort and asked a judge to immediately open up licensing to all retail dispensary applicants.

The group, Coalition for Access to Regulated & Safe Cannabis, describes itself as “an unincorporated trade association” composed of registered organizations, several of which plan to apply for a dispensary license to legally sell cannabis. Included in the group are several major national sellers, such as Acreage Holdings, PharmaCann, Green Thumb Industries and Curaleaf.

The lawsuit, filed in the Supreme Court of the State Court of New York, Albany County, claims the state’s Conditional Adult-Use Retail Dispensary (CAURD) licensing process violates the intent of the 2021 Marijuana Regulation and Taxation Act by creating a new license class, providing priority on dispensary licenses to justice-involved individuals with a significant presence in New York. This violates the law’s provision the application period be open to “all applicants at the same time,” the group contends.

“Rather than perform the tasks required by the MRTA — which would promote a safe and regulated cannabis industry for medical patients and adult-use consumers alike — CCB and OCM have improperly assumed the role of the Legislature to impose their own policies over those of New York’s elected officials and, by extension, their constituents,” the lawsuit states.

To date, 66 CAURD licenses have been issued. The lawsuit contends the low number of dispensaries has choked the market, with growers having few options to sell their product.

The state had hoped to have the legal cannabis market kicked into high gear by now, but progress has slowed. In October, a lawsuit filed by Variscite NY One resulted in a federal district judge preventing the Office of Cannabis Management from issuing licenses in five areas of the state (Finger Lakes, Central New York, Western New York, Mid-Hudson, and Brooklyn) until the lawsuit is resolved. That lawsuit alleges the CAURD program violates the Dormant Commerce Clause, which prevents states from passing legislation that discriminates against, or excessively burdens, interstate commerce.

If successful, the Coalition’s claims could force New York to immediately open the market to more than just CAURD applicants, allowing thousands of licensee hopefuls to apply for a cannabis license.

Attorneys with Harris Beach’s Cannabis Industry Team continues to monitor developments in the fast-moving New York cannabis industry. If you have questions about this lawsuit or related matters, please reach out to attorney Meaghan T. Feenan at (518) 701-2742 and mfeenan@harrisbeach.com, attorney William M.X. Wolfe at (315) 214-2059 and wwolfe@harrisbeach.com, or the Harris Beach attorney with whom you most frequently work.

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