New York cannabis board votes to settle license-blocking suit

BY KATE LISA NEW YORK STATE

PUBLISHED 2:30 PM ET MAY 30, 2023

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Members of the New York state Cannabis Control Board on Tuesday voted to allow the state Office of Cannabis Management to reach a settlement in a federal suit that's prevented the opening of retail dispensaries in half the state — contributing to a sluggish industry rollout.

A preliminary injunction has halted the board from issuing new retail licenses in the Finger Lakes, Central New York, Western New York, the Mid-Hudson region and Brooklyn for nearly seven months.

Board members and officials in the state office continue to finalize a settlement agreement with Variscite NY One. The owner of the cannabis retailer filed suit in November after the state office denied the company's application for one of the state's first 150 licenses to open a recreational marijuana shop.

"Today, the board voted to authorize the Office of Cannabis Management to make settlement," Aaron Ghitleman, spokesman for the Office of Cannabis Management, said in a statement. "When it's finalized, we'll have more to share."

It's unclear when an agreement will be finalized. The details of the settlement continue to be discussed, and were not expected to conclude Monday.

The company filed suit last year to challenge provisions of the law and New York's Conditional Adult-Use Retail Dispensary program, or the program that prioritized issuing the first 150 retail licenses to New Yorkers with a previous marijuana conviction under past drug laws. The state committed $220 million for a fund to bolster those retailers' success.

The delay has frustrated cannabis growers, processors and retailers alike — putting a strain on businesses and the crop's future success in the state.

"I am relieved and pleased that the state Office of Cannabis Management has reached a settlement in the Variscite lawsuit," said Sen. Jeremy Cooney, who chairs the Senate's Cannabis Subcommittee. "Hopefully, we can put this roadblock for the Finger Lakes Region behind us and focus on creating safe and legal access to recreational cannabis for adults in Greater Rochester. Public safety cannot be achieved in our state until all New Yorkers — including those of us in the Finger Lakes Region — can walk into a legal dispensary and purchase cannabis products that have been tracked and tested.

"I eagerly await future announcements of Conditional Adult Use Retail Dispensary licensees in the Finger Lakes Region, and our continued work to provide investment in these entrepreneurs and their businesses," the senator continued. "Only then will we achieve the social equity envisioned in the legalization movement.”