A California city’s approval of a marijuana distribution company’s business plan may set up a showdown between a state licensing agency and one of the MJ industry’s leading tech companies.
The West Sacramento City Council on Wednesday night approved DICA Distribution’s business plan and awarded a development agreement to the company, which has ties to the online advertising company Weedmaps.
DICA now moves farther along in the licensing process, potentially setting up a confrontation between the company’s principals and the California Bureau of Cannabis Control (BCC), which oversees retailers, distributors, testing labs and microbusinesses.
DICA’s CEO, Doug Francis, and president and general counsel, Chris Beals, hold the same titles at Weedmaps, which is at odds with the BCC.
Irvine-based Weedmaps has defied BCC order to stop carrying advertising for illegal marijuana retailers.
Weedmaps was sent a cease-and-desist letter by the BCC and the city of Sacramento earlier this year regarding its online listings for unlicensed MJ dispensaries and delivery services.
But Francis and Beals refused to comply with the letter, arguing that because Weedmaps is a website and doesn’t require a state license, it’s not under the Bureau’s jurisdiction.
The issue remains unresolved but could become a test case that reveals the extent of the Bureau’s powers over marijuana industry players, especially ancillary companies like Weedmaps.
DICA plans to apply for a state distribution permit, according to the business plan it submitted to West Sacramento.
Asked about DICA’s impending application, Bureau spokesman Alex Traverso wrote in an email to Marijuana Business Daily, “We’re going to evaluate their application as we would any that come to us.”
In a related development, the West Sacramento City Council also approved Wednesday night a business plan submitted by another marijuana company, WCC MGMT.
The company plans to seek state licenses for cultivation, manufacturing and self-distribution, according to its proposal.
DICA and WCC MGMT plan to share a building in West Sacramento, though they would operate out of separate neighboring suites.
Three family members spearhead WCC MGMT. Two of them have been operating West Coast Cure, a Newport Beach extraction and vape cartridge company, since 2010, according to a company profile on Weedmaps.
Newport Beach has banned all medical and recreational companies, according to online compliance company CannaRegs, a situation that potentially could set up a conflict with the BCC.
WCC’s general counsel and chief compliance officer is Craig Wasserman, a Southern California attorney whose family-run practice is called Pot Brothers at Law.