NEWS BRIEF

Two more lawsuits filed over L.A.’s social equity cannabis licensing

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Lawsuits filed by two former social equity applicants brings the total to at least six that have been lodged against Los Angeles regulators over the city’s social equity licensing for cannabis businesses.

The suits, filed by applicants Karla Benavides and Judith Contreras in Los Angeles County Superior Court, both name the same three defendants:

  • The city of Los Angeles.
  • The L.A. Department of Cannabis Regulation (DCR).
  • Accela, the software firm responsible for the program that ran the DCR’s license application system last September.

The parallel suits, filed Nov. 9, make the same claims: The plaintiffs were applicants who lost out on the opportunity for a marijuana retail permit last fall because of “general negligence” on the part of the city and Accela.

Specifically, the lawsuits claim that the two plaintiffs were unable to submit their applications at the required start time of 10 a.m. PT because of delays caused by the Accela-run software and, by extension, the DCR and the city.

Both plaintiffs allege they spent more than $25,000 renting retail space in the hopes of winning a permit and are suing to recoup those costs.

Other lawsuits L.A. faces over the licensing process include:

  1. One filed in April by Madison Shockley III and the Social Equity Owners and Workers Association, which was settled in July and resulted in an increase in the number of storefront permits, from 100 to 200.
  2. Another filed in September by three applicants from last fall, ARMLA One, ARMLA Two and Gompers SocEq, all requesting damages and that each be issued a permit.
  3. One filed in October by longtime marijuana delivery operator Zach Pitts and two trade groups – Southern California Coalition and California Cannabis Couriers Association – aiming to overturn a new ordinance that devotes all MJ delivery permits to social equity applicants until 2025.
  4. Another filed in late October by eight companies and individuals – led by Angel City Partners – who attempted to apply for retail permits in September 2019 but claim their applications were ignored by the DCR. The suit requests an emergency injunction to halt the licensing process and a do-over of the entire licensing process if their applications aren’t considered.

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