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Who made the list? 30 out of 400 NY weed shops could still be allowed to open.
By
Caroline Lewis
Published Aug 23, 2023
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Leonardo Munoz/VIEWpress
By
Caroline Lewis
Published Aug 23, 2023
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Jeremy Rivera, the co-owner of a cannabis company called Terp Bros, was distraught when he found out in early August that a state Supreme Court judge was considering whether to prevent any new licensed cannabis dispensaries from opening in New York. It came just days before Rivera planned to start making sales at his shop in Astoria.
The judge ultimately issued a preliminary injunction last week that blocked any further expansion of the state’s retail market under its current licensing rules. Now, Rivera is one of just 30 licensed cannabis retailers — out of more than 400 statewide — that made it onto a list to be exempt from the injunction.
State officials submitted the roster to the court on Tuesday afternoon, and if the judge accepts it, Rivera will be able to move forward with his plans to open under the state’s Conditional Adult Use Retail Dispensary — or CAURD — program.
But hundreds of other cannabis entrepreneurs in the program were left off the list. Some had already sunk tens of thousands of dollars and months of work into setting up their businesses.
“New York cannabis has been a rough ride, to say the least,” said Rivera, whose company is named on the list as Kush Culture Industry, even though he’s doing business as Terp Bros. “I am happy that I’m on that 30-person list. But there are so many more people that didn't meet those requirements. Does that make them any less quantifiably harmed?”
State Supreme Court Judge Kevin Bryant first issued a temporary restraining order against the state’s cannabis licensing program on Aug. 7, pausing any new licenses from being issued and barring any new shops from opening. The stoppage came in response to a lawsuit filed by four service-disabled veterans who alleged that the CAURD program – which prioritizes granting licenses to people with past marijuana convictions and their family members – was not sufficiently in line with the Marijuana Regulation and Taxation Act, which legalized marijuana in New York in 2021.
The veterans argued that they would have qualified for licenses under the broader criteria for social equity licenses included in that law.
Bryant’s ruling said that the plaintiffs are likely to succeed on the merits of their case. The judge decided to make an exception for some existing retail licensees after hearing arguments that they would suffer major economic losses if their businesses were prevented from opening.
However, Bryant set a high bar for CAURD licensees to get relief. In the ruling issued on Friday, he said the injunction would not apply to those who “met all requirements for licensing, including but not limited to site plan approval from the [Cannabis Control Board] and, where applicable, from local municipalities” prior to Aug. 7.
Some CAURD licensees who spoke with Gothamist said they had already found a location for their shops and provided state officials with a letter of intent from the landlord to sign a lease. But those who were still waiting for their dispensary locations to receive state approval didn’t meet the criteria to make the exemption list. It’s unclear whether some who did get that approval were also left off for other reasons.
Dan Morena said he submitted a letter of intent to the state from a Manhattan landlord prior to the lawsuit but didn’t hear back on whether the location was approved. He said he had already invested tens of thousands of dollars into his business — between lawyer’s fees and other expenses — and that he had spent months searching for the right financial backer.
He said he has also lost out on money from potential clients he passed up through his existing consulting business because he was working on setting up his weed enterprise.
I didn't think that this late on, it would go down like this.
Dan Morena, entrepreneur and CAURD licensee
“I knew that this was going to be really hard, and I knew that it was really risky,” Morena said. “I didn't think that this late on, it would go down like this.”
Of the 463 retail businesses that have received licenses so far, only about two dozen have already opened cannabis dispensaries or delivery operations statewide. Those businesses will be allowed to continue operating.
Entrepreneurs who were not on the state’s list will still have a chance to plead their case to the court. In a letter sent to licensees on Monday, the state Office of Cannabis Management said it was setting up an electronic form for people to detail the damages they would suffer if they could not move forward with opening their businesses. State officials will then present those requests to the court.
Morena said the state should find a way to compensate licensees who are unable to move forward.
“You have to find a way to ease it,” he said. “They're exposing hundreds of people to damages.”
Dispensary owners aren’t the only ones affected. New York is currently holding a series of cannabis showcase events for distressed growers to sell their wares. One such showcase will open near a state fair in Syracuse on Wednesday. Even before the injunction was issued, New York farmers were worried about not being able to sell enough of their cannabis harvest from last year to licensed shops, given the slow pace of the legal industry’s rollout.
Vladimir Bautista, CEO of the cannabis company Happy Munkey, is one of over 200 CAURD applicants who just received a license last month.
He said he has already spent thousands of dollars on lawyer’s fees and marketing in anticipation of opening his business.
“We're right now entering into deals with a designer, with an architect, with a general contractor, and all these different things,” Bautista said. He added that he would travel with other CAURD licensees to the courthouse in Kingston this Friday for the next hearing in the case.
Tagged
cannabis
new york state
Health and Science
marijuana
weed
Caroline Lewis
Caroline Lewis is on the health care beat for WNYC and Gothamist. She has covered COVID, a nurses' strike, the overdose crisis and New York’s marijuana legalization effort, and spent a year investigating patients' medical bills. She always wants to hear about how everyday New Yorkers experience the health system. Got a tip? Email [email protected].
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Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
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