A California attorney notorious for challenging cannabis social equity programs across the country wants the United States Supreme Court to rule on marijuana licensing.
In a petition filed with the Supreme Court on Tuesday, Beverly Hills-based attorney Jeffrey Jensen, the counsel for companies that have applied for social equity permits in several states – and filed lawsuits when they were denied for not meeting residency requirements – asked the high court to find such requirements violate the U.S. Constitution.
The specific cases Jensen and his co-counsel are appealing to the Supreme Court originated in Washington and California, where companies called Peridot Tree sued state regulators after they were denied permits. The companies are majority owned by Kenneth Gay, a Michigan man, who was denied “solely” based on his residency, the petition notes.
But if the Supreme Court agrees to hear Peridot Tree’s appeal and determines that cannabis licensing requirements that favor residents of a specific area over other applicants violate the Constitution’s Dormant Commerce Clause, the result could go beyond marijuana social equity programs across the country.
In a statement provided to MJBizDaily, Jensen said he and San Francisco-based attorney Chad DeVeaux of firm Batko Pavia, the petition’s counsel of record, “are excited to see the culmination of six years of work toward opening the markets for the benefit of cannabis consumers nationwide.”
Are cannabis social equity programs constitutional?
As the petition notes, the question of residency requirements “has arisen frequently in courts across the country and will continue to do so.”
“States continue to enact discriminatory licensing laws that will spur future lawsuits,” it added in part.
The appeal to the Supreme Court follows setbacks at the 9th Circuit Court of Appeals, which found earlier this year that because cannabis remains “illegal under federal law” thanks to the Controlled Substances Act, the Dormant Commerce Clause does not apply.
That saved the social-equity programs in Washington and in Sacramento, California, which “unquestionably would be unconstitutional if applied to any other legal market,” the petition argued.
However, that rationale didn’t work in other appeals courts – and has already led to cannabis regulators in other states scrapping earlier licensing rounds.
Why did courts reject marijuana social equity programs?
In 2025, the 2nd U.S. Circuit Court of Appeals found that New York State’s “prioritization of applicants with convictions under New York law is a protectionist measure that cannot stand.”
“The dormant Commerce Clause prohibits state protectionism unless Congress clearly authorizes specific protectionist laws,” U.S. Circuit Court of Appeals Judge Dennis Jacobs wrote at the time.
That followed a similar 2022 decision in the 1st Circuit Court of Appeals that ruled in a case first brought in 2020 by an affiliate of marijuana multistate operator Acreage Holdings.
The circuit split, in which the 9th circuit made a different finding than the 1st and the 2nd circuits, makes the case ripe for Supreme Court review, the petition argued.
Who is challenging marijuana social equity at the Supreme Court?
Whatever the outcome of the Supreme Court case, the residency question – and Gay’s and Jensen’s challenges to it – have already left their mark on the cannabis industry.
A Jensen-involved challenge to a residency requirement in Rhode Island led to that state scrapping the provision and restarting a licensing round.
And the Jensen-led challenge to New York’s ambitious “equity-first” cannabis program is credited with contributing to the “botched” rollout of legal marijuana sales in that state.
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Will the Supreme Court decide on marijuana rescheduling?
If the Supreme Court does hear the case, there’s a chance justices could also rule on federal marijuana rescheduling.
That’s because the petition argues that cannabis will remain illegal even if the Trump administration’s push to reclassify all marijuana under federal law as a Schedule 3 substance succeeds, the petition argued.
“A Schedule III drug may be sold only under a prescription issued for a legitimate medical purpose,” the petition argues. “Recreational cannabis is not sold under a prescription.”
“Thus, recreational cannabis will remain nominally illegal under federal law even if the DOJ more broadly reschedules cannabis from Schedule I to Schedule III.”
Chris Roberts can be reached at chris.roberts@mjbizdaily.com.
