A group of licensed medical marijuana dispensaries in a Southern California town have sued MMJ outlets without legal permits to prevent them from selling cannabis.
The Santa Ana Cannabis Association filed the lawsuit targeting 14 unlicensed dispensaries in Santa Ana. The suit alleges the dispensaries are operating illegally, ignoring local safety codes and undermining the licensed businesses, according to the Orange County Register.
A 2014 initiative approved by the city stipulated 20 licensed dispensaries, with the permits to be doled out through a lottery.
In March 2016, Santa Ana officials reported there were twice as many dispensaries operating illegally as legally, undermining those outlets operating within the law.
California’s black and gray markets are major challenges to the successful implementation of the legal market in the state. Since the state legalized rec marijuana in 2016, some business owners are finding California’s regulatory framework to be difficult to navigate.