Referendum Drive, Lawsuits Not Enough to Delay LA Marijuana Dispensary Ban

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The Los Angeles medical marijuana industry is exploring every avenue to prevent a recently approved ban on dispensaries from crippling the city’s entire MMJ infrastructure. Advocates and professionals are working aggressively to force a voter referendum in an attempt to overturn the ban, while some lawyers predict we’ll see an avalanche of lawsuits against the city in the coming months.

There’s certainly a chance these efforts could succeed, offering a glimmer of hope for the medical marijuana industry’s future in Los Angeles.

But a referendum drive and lawsuits will do little to change anything in the immediate future. It will take months – and possibly much longer – for these moves to play out, providing little solace for roughly 1,000 dispensaries that will be forced to close in two weeks when the ban takes effect.

Shutting down a business and then reopening it months later is an expensive endeavor. Owners will have to cope with a hefty amount of uncertainty and financial stress. They’ll have to figure out what to do with all of their equipment, office furniture and other assets while they wait in limbo. They’ll have to find another source of income for an indefinite period of time. And in many cases they will have to continue paying off debt used to build their business.

It’s a toxic mix, and only the strong can afford to wait and see how everything shakes out.

The 180 or so dispensaries that opened before a 2007 moratorium went into effect have the best odds of survival, as the city is drafting up a proposal that would eventually allow them to operate again

Some of those dispensaries have indicated that they will remain open after the Sept. 6 ban and attempt to fly under the radar until the city follows through on its plan (if it does at all). But they face huge risks – the city has promised steep fines and penalties for any dispensary that defies the ban. At the same time, older dispensaries that comply with the ban and shut down will have to wait weeks or months to find out whether they can reopen, and some likely don’t have the resources to remain idle that long.