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Lawsuit could slow issuing cannabis licenses

Nov 11, 2022 1:02 pm

Brendan J. Lyons and Rebekah F. Ward report in the Times Union that on Nov. 10 a federal judge in Albany issued a temporary injunction stopping New York's Office of Cannabis Management from issuing retail licenses in five regions of the state. The lawsuit was brought by a company whose application to operate a marijuana store failed to qualify because it lacked "a significant New York state presence." U.S. District Senior Judge Gary L. Sharpe blocked issuing cannabis licenses in the Finger Lakes, central New York, western New York, Mid-Hudson, and Brooklyn. Officials have been expected to begin retail cannabis sales in New York before the year ends. The ruling comes because Variscite NY One, Inc., whose owner has a past marijuana conviction from Michigan though his company is incorporated in New York, was determined to not have "a significant New York state presence." The lawsuit is based on the "dormant commerce clause" of the U.S. Constitution that "prevents states from adopting protectionist measures and thus preserves a national market for goods and services." The judge wrote in his decision that, "The balance here tips in favor of Variscite, given that OCM has not begun issuing licenses, and will not begin issuing licenses until, at the earliest, (Nov. 21)," Sharpe wrote. "Additionally, all of defendants’ arguments are undercut, to some degree, by the fact that Variscite only seeks to enjoin the application process in five of the (14) geographical regions, and defendants could proceed with the licensing process in the other eight regions." Read more about this story in the Times Union.

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