Immediately following the opening of the application portal for adult-use cannabis licenses, Plaintiffs Carmine Fiore, William Norgard, Steve Mejia, and Dominic Spaccio, in the lawsuit against New York State’s Cannabis Control Board and Office of Cannabis Management (“OCM”) in the New York State Supreme Court, Albany County, filed a letter with the Court accusing the OCM of circumventing the injunction issued by Honorable Kevin R. Bryant on August 18, 2023. Specifically, Plaintiffs state that the OCM is still actively prioritizing CAURD applicants over the OCM’s Social Economic Equity (SEE) applicant initiative by providing: i) “expedited consideration” to retail dispensary applicants and ii) giving preference to those applicants who can evidence “proof of control” over a proposed premises.
The Plaintiffs argue that OCM’s “expedited consideration” to retail dispensary applicants who can display “proof of control” over a proposed premises, and to applicants who submit their applications by November 3, 2023, clearly give a prior CAURD applicants a distinct advantage because these applicants were allegedly given exclusive access to the required municipal notice form prior to its release on September 29, 2023, which allowed them to have a head start in the application process. In contrast, non-CAURD applicants had at most 5 five days to prepare the proper notice to the relevant municipality in order to be considered for the expedited review.
Additionally, the Plaintiffs allege that the “proof of control” of a commercial space advantage prior CAURD applicants as well. Proof of Control may only be demonstrated by presenting an executed lease agreement or a deed of ownership. CAURD applicants, through the early acquisition of commercial space, not only are able to become operational sooner, but will impose a 1,000- or 2,000-foot “buffer” around the property, prohibiting any other potential applicant from applying for a license in that designated zone. As a result, it is alleged CAURD applicants will, by default, have an advantage in securing their location early and controlling the buffer zone by prohibiting other applicants to acquire a licensed property within close proximity.
If these allegations are true, the prioritization of the previous CAURD applicants would contradict the policy of the Marihuana Regulation and Taxation Act, which set a goal to award 50% of all adult-use licenses to SSE applicants, which include individuals disproportionately impacted by cannabis prohibition, disabled veterans, minority, and women owned businesses, and distressed farmers.
The Wagoner Firm has been monitoring the Plaintiff’s investigation into this matter and will remain informed what future proceedings, if any, may be warranted. Our team is readily available to address any inquiries related to cannabis industry and are committed to providing guidance to prospective applicants and sellers. For further details, please contact our office at (518) 400-0955.