Coalition sues marijuana regulators to open licensing process

ALBANY — A new coalition of medical marijuana license holders and recreational market hopefuls filed a lawsuit in state Supreme Court this week seeking to force New York’s Office of Cannabis Management to open the retail licensing process “for all applicants immediately.”

The slow rollout of licensing for entrepreneurs beyond those with a documented marijuana conviction in their family has angered small business owners who thought they would have an earlier shot at one of the state’s first retail sales licenses, including those defined under the law as “social equity” applicants. It has also frustrated large companies that entered the market early but are still permitted to sell only to certified medical patients. 

The challengers argue that equal access to the first recreational licensing process should have been available to them under the state’s 2021 cannabis law, which specifies that “the initial adult-use cannabis retail dispensary license application period shall be opened for all applicants at the same time.”

The lawsuit, filed in Albany, claims that by creating limited, “conditional” licensing categories that opened prior to the general process, regulators have “overstepped their rule-making authority” and subverted legislators’ intent.

The agency’s “arbitrary and capricious foray into legislative policymaking has harmed those individuals the (cannabis law) was designed to benefit … and diverted (regulators’) attention from the enforcement tasks” that the law requires, according to the court petition.

In a press release highlighting the legal case on Thursday, members and supporters of the new Coalition for Access to Regulated & Safe Cannabis — the group bringing the lawsuit — outlined their position on why they say state regulators’ decisions have undermined both medical patients and recreational cannabis users. 

The cannabis law “specifically lays out a list of individuals — including veterans — who should benefit from the state’s adult-use program,” said the Veterans Cannabis Project’s Stephen Jones, who supports the lawsuit but is not a coalition member. “And yet, that clear legislative intent is being subverted by overzealous regulators who have taken it upon themselves to make up policies that are limiting participation to an extremely narrow group.”

The release also cited Dr. Lynn Parodneck, a Westchester doctor whose practice prescribes cannabis to patients. “New York’s medical program is stagnant, and both my business and my patients have suffered as a result,” Parodneck said.

A spokesman for the Office of Cannabis Management said the agency does not comment on pending litigation. 

David Feuerstein, one of the attorneys representing the coalition, said regulators “neglected their responsibilities” to enforce the law as written, focusing instead on “high-minded policymaking — a role that is reserved for our state’s elected officials.” He added that the current state of the market is “unacceptable.”

While a few of New York’s initial cannabis retailers have opened, selling locally grown weed cultivated by former hemp farmers across the state, even the winners of those first “conditional” licenses have waited longer than expected to open their doors. The delays have occurred as the number of unlicensed shops selling weed across the state has ballooned, with vendors trying to take advantage of loopholes or blatantly flaunting the law. 

No licensed retail shops have been authorized to sell marijuana in the Capital Region, although a retailer in downtown Schenectady is expected to receive approval to have the area’s first recreational sales when that happens.

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