First Marijuana Farmers Market Opens In NY Amid Lawsuit Chaos: 'No Good Deed Goes Unpunished' Says Cannabis Attorney

The New York cannabis market has been, still is, one hell of a roller coaster ride. Industry members nervously await the outcome of a temporary ban on the issuance of new retail licenses. A decision is expected on Friday after oral arguments are heard. Meanwhile, regulators have announced the first Cannabis Growers Showcase. 

What Happened: The Office of Cannabis Management (OCM) announced that the first Cannabis Growers Showcase will be hosted in New Paltz on Thursday, August 10. Other public events that would be among the first to feature legal recreational marijuana products for sale will take place in Saratoga, Brooklyn, Hoosick Falls and Western New York in the coming weeks, reported Spectrum News 1.

The first Cannabis Growers Showcase will be hosted in New Paltz on Thursday, August 10.
New Yorkers can meet #NYcannabis growers and processors and experience all that this market has to offer every Thu-Fri from 4-8 and Sat from 1pm-8pm until year end.

— NYS Office of Cannabis Management (@nys_cannabis) August 9, 2023

Meanwhile, the latest lawsuit has got everyone who's already got a preliminary retail license on the edge of their seats. The licensing process falls under the OCM's Conditional Adult-Use Retail Dispensary (CAURD) program. 

In one of the lawsuits filed by attorneys from NYC firm Clark Smith Villazor, LLP, four veterans - Carmine Fiore, William Norgard, Steve Mejia and Dominic Spaccio - are accusing the OCM of violating New York's cannabis law by prioritizing licenses for individuals with prior drug convictions. NY's law is known as the Marijuana Regulation and Taxation Act (MRTA).

On Monday, a state Supreme Court judge ordered a temporary halt on the issuance of new retail licenses.

The Key Difference Between Two Lawsuits

“If the long-term injunction is granted at Friday’s hearing it could be in place until at least mid-September or early October because the plaintiffs have asked the Court to tie the injunction to the resolution of certain motions for summary judgment filed in a related lawsuit brought by the Coalition for Access to Regulated & Safe Cannabis (CARSC) in March of this year,” said Fatima Afia, a cannabis lawyer and expert in cannabis litigation at Rudick Law Group.

“So most CAURD applicants and non-operational CAURD licensees could lose some of the first-movers advantage they otherwise would have had if the license application window for the broader adult-use program opens in October as previously announced by OCM,” she told Benzinga.

The group, involved in the previous lawsuit alleging the OCM violated the cannabis legalization law by reserving the first 150 retail licenses for social equity applicants, includes at least four large marijuana companies, Acreage Holdings, Curaleaf Holdings, Green Thumb Industries and PharmaCann. Read more about the many pending and resolved lawsuits against cannabis regulators here.

According to Afia, the legal arguments in both cases are basically the same, with a key difference being the plaintiffs. She explained that service-disabled veterans would “arguably qualify as social and economic equity applicants under the MRTA and perhaps benefit from "first movers" advantage (to the extent such an advantage actually exists) if not for the CAURD program.” On the other hand, the plaintiffs in the other lawsuit consist of mostly retail operators “who have infinitely greater resources and advantages than other applicants and would have difficulty demonstrating that they’ve been “irreparably harmed” by the CAURD program as they must in order to secure an injunction.”

What If?

Afia noted that if the injunction ends up being granted on Friday, it will be interesting to see if any retail license applicants and licensees will respond by laying out their damages, such as the losses they experienced as a result of first movers' advantage that presumably helped them get a license, the exorbitant costs of putting together their teams and application materials, loss of funding, inability to honor material contracts they’ve already executed...the list goes on, she concluded.

With the OCM playing defense at every turn instead of being appreciated, though not perfect, it reminded Afia of the old saying “No good deed goes unpunished.”

Farmers Urge Expansion Of Retail License Applications

Depending on what happens Friday, cannabis growers might have to rely on selling their products at approved public events, which is why marijuana growers are urging New York regulators to expand retail licenses.

"We want to see this be a really diverse marketplace that has a lot of opportunity for a lot of different operators from a lot of different backgrounds, and we need the general applications to open to be able to do that," Brittany Carbone, a licensed cultivator and board member of the Cannabis Association of New York told Spectrum News 1. 

Carbone said it's crucial for New York's retail licensing program to get moving and allow more cannabis shops to open.

Previously the OCM announced plans to expand retail applications in October but, Carbone explained, it takes an average of a year to 18 months to open a retail location after the application is approved.

Meanwhile, as delays drag on they're obviously providing more space for the illegal market to thrive. So the industry can only hope for some kind of resolution that will be a win for everyone.

The Benzinga Cannabis Capital Conference, the place where deals get done, is returning to Chicago this Sept 27-28 for its 17th edition. Get your tickets today before prices increase and secure a spot at the epicenter of cannabis investment and branding.

Photo: Benzinga edit with images by Billion Photos and Yarygin by Shutterstock