John Schroyer
A new lawsuit was filed against New York cannabis regulators by a quartet of disabled military veterans who have been thus far shut out of retail marijuana licensing.
The suit contends that the state Office of Cannabis Management and the Cannabis Control Board violated state law by prioritizing certain social equity candidates for retail permits and wrongly left disabled military veterans waiting on the sidelines. The group wants a state judge to issue a temporary restraining order to halt any further licensing.
The lawsuit, filed Aug. 2 in the Supreme Court of New York in Albany County, argues that the state law which created the licensing process – the Marijuana Regulation and Taxation Act of 2021 – allowed for no special treatment for “justice-involved” individuals to be given licensing priority without allowing service-disabled veterans into the pool. But that’s exactly what the OCM and CCB have done with issuing 463 social equity retail permits thus far, it contends.
New York’s top cannabis regulators “improperly assumed the role of the Legislature to impose their own social and economic policies over those of New York’s elected officials,” the suit asserts, adding that “chief among defendants’ transgressions was their creation of an entirely new licensing category,” the conditional adult use retail dispensary program.
“Defendants improperly limited eligibility for this special, yet legally impermissible, license category to only ‘justice involved individuals’ who own a profitable ‘qualifying business,'” the suit claims. “Then, defendants opened the adult-use retail dispensary application period for only those individuals that qualified as CAURD applicants, and indefinitely postponed the licensing of hundreds of additional dispensaries necessary to satisfy consumer demand.”
The suit further notes that all four plaintiffs qualify as “priority or extra priority” license applicants under the 2021 state law.
New York veterans OCM lawsuit Aug 2023The plaintiffs – Carmine Fiore, William Norgard, Steve Mejia, and Dominic Spaccio – all made business plans to enter the cannabis industry following the passage of the MRTA two years ago, because the law requires regulators to reserve 50% of retail licenses for “social and economic equity applicants,” including “service-disabled veterans.”
“Despite the MRTA’s clear language, defendants have embarked on a … lawmaking project to craft a new ‘social equity’ policy that is inconsistent with the priorities of the Legislature,” the suit argues. “Defendants’ conduct directly contravenes the Legislature’s express mandate … to open ‘the initial adult-use cannabis retail dispensary license application period … for all applicants at the same time.”
In addition, according to a press release, the four plaintiffs spent serious amounts of money securing real estate and otherwise preparing to enter the marijuana trade, only to have to watch as first-mover advantage passed them by.
“It feels like we were used to get a law passed—a good law, one that helps a lot of people, as well as the state,” Fiore, one of the plaintiffs, said in the release. “Then, once it was passed, we were cast aside for another agenda.”
Fiore, a U.S. Army and New York Army National Guard veteran, said he secured a location in Suffolk County on Long Island for a marijuana dispensary after the MRTA was signed into law, but as he watched the CAURD licensing play out, he ultimately was not able to hold onto the real estate while waiting for his chance to obtain a permit.
Spaccio, another of the plaintiffs, said he’s “sitting in an empty retail location” in the Finger Lakes region of New York, waiting for a shot at a dispensary license.
There has not yet been an announcement as to when licensing will be open to entrepreneurs who didn’t initially qualify for CAURD permits, though OCM Executive Director Chris Alexander said at the board’s last meeting that his office was beginning work on “universal” business permit applications for the general public. Those could be available as soon as September, pending board approval.
Another lawsuit that made similar claims – that regulators erred in not opening up licensing to all stakeholders at the same time – was filed in March by the Coalition for Access to Regulated and Safe Cannabis. That group includes several of New York’s 10 licensed medical marijuana companies, such as Acreage Holdings, Curaleaf, Green Thumb Industries, and PharmaCann. The organization followed up the lawsuit with a June rally in front of Gov. Kathy Hochul’s New York City office. That suit is still pending.
A spokesman for the OCM did not immediately respond to request for comment Thursday.
