Four service-disabled veterans settled a lawsuit with the Cannabis Control Board on Nov. 28, essentially unfreezing a conditional retail licensing program for the state’s marijuana industry. This means that over 400 retail establishments can again proceed towards receiving conditional licenses statewide. Specifically, entrepreneurs that were banking on opening dispensaries can now do so.
Only 26 dispensaries have been legally licensed and opened statewide. Eleven of those are located in New York City, with six in Manhattan.
The vets had essentially taken issue with equity provisions in the Conditional Adult-Use Retail Dispensary Program, which they claimed excluded them from being prioritized. Essentially, the program had focused on granting licenses to people with past marijuana convictions (or immediate family members of those convicted under the old law). The veterans claimed that violated the state’s Marijuana Regulation and Taxation Act. After the suit was filed in August, a judge in Ulster County froze the licensing program It had just started to crank up again after Governor Hochul signed legislation allowing hundreds of new firms to apply.
The veterans had piggybacked off a March lawsuit filed by four medical marijuana companies, who posited a similar argument claiming they were being illegally excluded from getting licenses. That suit was settled as well.
Chris Alexander, the Executive Director of the state’s Office of Cannabis Management, hailed the settlement in a statement: “Today, we are one step closer to resolving litigation brought forth by equity entrepreneurs and our medical operators who felt that they were being left behind. Now that we have opened up licensing to all equity entrepreneurs and provided a clear pathway to participation in the adult-use market for our medical operators, we are able to continue to move this program forward together.”
Tremaine Wright, the chair of the Cannabis Control Board, chimed in to add that ”today’s approval of the settlement agreement by the New York State Cannabis Control Board marks a momentous step forward in our mission to cultivate a diverse and inclusive cannabis market.”
The settlement of the lawsuit comes shortly before a full retail licensing bonanza, kicked off by NYS Governor Kathy Hochul in October, is slated to resume. Applications for that additional program end on December 4, with licenses set to be issued in early 2024. In other words, aspirational cannabis retailers that struggled to survive the pause in the conditional program now potentially have a host of new competitors in the form of disabled veterans applying for the same licenses as the former marijuana convicts.
Hochul herself praised the settlement, noting that it would further the “worthy goal” of opening legal retail stores. She added that she would continue to focus on shutting down “illegal storefronts,” a cause that the New York City Council has also taken up recently. That legislation is moving slowly, with public hearings not expected until sometime next year.