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New York’s Embattled Cannabis Regulators Hit By Another Major Lawsuit

New York’s beleaguered cannabis regulators have been hit with another lawsuit that seeks to invalidate hundreds of licenses in the already underserved state.

According to Law 360, the suit is taking aim at the state’s CAURD programme, which was designed to give social equity applicants a head start in New York’s fledgling adult-use cannabis market.

A state New York Supreme Court judge has been called on to invalidate 463 cannabis retail permits issued to CAURD applicants last year amid allegations that the authorities overlooked a step in the licensing process.

Although only 122 of those businesses are open as of May 10, the suit will be another major setback for the Office of Cannabis Management (OCM) and Cannabis Control Board (CCB).

“Prior to filing an application for licensure, applicants are required under MRTA § 76(1) to notify the municipality in which the proposed premises are located of the applicant’s intent to file an application. However, CCB and OCM permitted CAURD applicants to apply for adult use retail dispensary licenses without identifying proposed premises and without municipal notification.”

The plaintiffs, all of whom applied for retail permits during the most recent tranche late last year, argue that the authorities have acted unlawfully by awarding the licenses without notifying the cities and towns where their shops would be opening.

It comes just days after the head of the OCM, Chris Alexander, was forced to resign amid an ongoing overhaul of the troubled legalization project.

On Friday (May 10), a damning report into the rollout of New York’s legal adult-use cannabis industry was published, calling the Office of Cannabis Management’s  handling of the process into question.

It comes after the state Governor, Kathy Hochul, ordered the commissioner for the New York State Office of General Services, Jeanette Moy, to conduct an internal review of the entire organization in March, dubbing the situation a ‘disaster’.

In a press conference, Hochul stated that the review was not about assigning blame, but about ‘pointing the OCM in a new direction’.

However, she confirmed that Alexander, who was the architect of the legalization bill passed in 2021, will step down in September when his three-year term comes to an end.

 

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