Cannabis 'Gifting' Shops Sue Washington DC Authorities Over Closures

A group of unlicensed cannabis retailers in Washington D.C. has filed a lawsuit against the District’s authorities, challenging enforcement measures targeting their businesses.

The Alliance for Recreational Cannabis Entities, representing seven shops, is suing District of Columbia, Mayor Muriel Bowser, the Alcoholic Beverage and Cannabis Administration (ABCA), the Department of Licensing, and Police Chief Pamela A. Smith, reported Green Market Report

The complaint alleges that recent enforcement actions, including forced closures and cease-and-desist orders violate constitutional rights and local laws.

The Alliance argues that the measures were imposed without due process, depriving owners of their property and livelihoods.

D.C.'s cannabis market has faced regulatory extravaganza since the passage of Initiative 71 in 2014, which legalized personal use and possession. However, a congressional rider, known as the "Harris Rider," has prevented D.C. from regulating cannabis sales, creating a legal gray area.

Unlicensed stores capitalized on this by adopting a "gift economy" model, offering cannabis as a gift with the purchase of other items, such as T-shirts.

Read Next: EXCLUSIVE: Is Washington DC’s ‘Cannabis Gifting’ Economy Coming To An End?

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The lawsuit also points to issues with the city's transitional licensing process.

Applicants were required to sign an affidavit admitting to previous illegal cannabis sales, which the Alliance claims violated their Fifth Amendment right against self-incrimination.

D.C. has recently intensified its crackdown following the enactment of the Medical Cannabis Conditional License and Unlicensed Establishment Closure Clarification Emergency Amendment Act of 2024.

In this context, authorities shut down four stores and arrested at least one owner. The Alliance seeks an end to enforcement actions, arguing that gifting cannabis remains legal under the current code. Despite the crackdown, many unlicensed shops continue to operate.

• Read Next: D.C. Continues Crackdown On Cannabis Gifting Shops: One Arrested, Store Padlocked, Although Many More Remain Open

Cover: Benzinga edit based on Washarapol D BinYo Jundang and Anna Lowe via Pixels