New York hit with another lawsuit challenging marijuana social equity

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Lawsuit-weary marijuana regulators in New York State have been hit with yet more litigation.

At issue – yet again – is New York’s controversial Conditional Adult-Use Retail Dispensary (CAURD) program, which prioritized “justice-impacted” individuals who could demonstrate harm caused by the war on drugs.

In a lawsuit filed May 9 in state Supreme Court in Albany County against New York’s Cannabis Control Board and Office of Cannabis Management, four plaintiffs – Organic Blooms, Niagara Nugget, Blackmark and Windward Management – point out that CAURD applicants were able to file an initial request for a state license without securing real estate and alerting the local municipality.

Those weren’t privileges extended to anyone who applied for a general license rather than a social equity permit during an October-December application window, the suit alleges.

That October-December application period is when the plaintiffs filed their adult-use applications, according to the suit.

Still awaiting a decision

The plaintiffs have yet to receive a decision from the state on their pending applications, the suit claims.

The suit argues that the CAURD program is an “arbitrary and capricious” application of state law and that “and any and all licenses improperly granted pursuant to this program are invalid.”

That would mean revocation of roughly 460 CAURD permits, including most of the 127 adult-use stores licensed to date.

Nearly all of the retail stores open in New York are CAURD licensees.

Lawsuits slowing adult-use rollout

The CAURD program, meant to fulfill lawmakers’ promise to award the first business permits to social equity applicants, has now drawn multiple lawsuits.

Some of these legal challenges contributed to the slow rollout of recreational marijuana sales in the state, a situation Gov. Kathy Hochul called a “disaster.”

The first recreational marijuana store did not open for business until December 2022, roughly 19 months after the state legalized adult use.

Last week, in a move many saw as assigning responsibility for the fiasco, Hochul announced that the Office of Cannabis Management’s executive director, Chris Alexander, would not be retained when his term ends in September.

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