Dispensary license applicants continue to be frustrated by slow processing of the 2023 applications by the New York Office of Cannabis Management (“OCM”). It remains unclear when a new application window will be opened for new applications and whether the OCM will adopt a cap on the amount of dispensary licenses issued. A December 2024 injunction further slowed the processing for certain license applications. However, in a series of clarifying rulings, New York courts have clarified that the injunction is limited to a narrow portion of the application pool and that application processing for many applicants will continue.
On December 13, 2024, OCM released a public statement indicating that it was pausing the processing of Conditional Adult-Use Retail Dispensary (CAURD) applications that did not submit proof of a municipally noticed secured location by November 17, 2023 and all other provisional adult-use applications.
On December 11, 2024, the New York Supreme Court issued a preliminary injunction in the case of Organic Blooms, LLC, et al. v. The New York State Cannabis Control Board, et al. (Index No. 904497-24). This legal challenge centers on claims that policy decisions made by the Office of Cannabis Management (OCM) and the Cannabis Control Board (CCB) in 2022 and 2023 do not align with the Marihuana Regulation & Taxation Act (MRTA).
Current Rulings On Organic Blooms LLC et al v. New York State Cannabis Control Board – December 2024 | Cannabis Law Report is a great article summarizing the legal arguments and future implications for CAURD licensees. It also has a link to some of the court documents for those interested in learning more details about the proceedings.
Despite the most recent judicial injunction against the OCM, New York licensees with a license and a location in hand would not be stopped from moving forward and opening a dispensary. This is true even if the licensee originally applied for a provisional license or as a CAURD applicant. The Court has clarified that the injunction does NOT apply to:
- All non-provisional applications in the November 2023 and December 2023 queues (including public convenience and advantage requests);
- CAURD applications that sent municipal notification forms to OCM prior to 11/17/23 (including public convenience and advantage requests);
- Any amendment requests, location approval requests, or other processing of already licensed entities whose licenses were approved prior to the injunction;
- Public convenience requests;
- Anyone who met the November 17th date even if they subsequently lost their location or otherwise failed to secure it;
6. Any further processing of already-licensed CAURDs and non-provisionals even if they failed to meet the notice to municipality deadline of November 17th;
7. Anyone who submitted their notice to municipality by November 17th even if their submission was not within the 30-day notice period; and - Anyone who was approved for licensure by CCB or who received written confirmation of license approval from OCM on or before December 12th .
If you have a pending application and are unsure whether your application is affected by the current injunction, reach out and we can review your case. In this highly regulated industry, the landscape is continually evolving due to regulatory changes, lawsuits and political climate. Missteps can have expensive and sometimes irreversible consequences on the business and its principals. The entire business investment could be lost or the principal could become ineligible for further licenses in New York (and potentially other states as well). It is important to have an experienced team of consultants to guide you through the transaction.
If you’d like legal guidance in exploring an opportunity to acquire a marijuana business or license, please contact our office. We would be honored to help.
Tracy Jong is a Senior attorney at Evans Fox LLP with 30 years of experience focusing her practice in business law, intellectual property and licensing for alcohol and cannabis. Tracy Jong is a member of the New York Bar and is a registered attorney at the United States Patent and Trademark Office. She can be reached at [email protected].
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The content has been prepared for informational purposes only; it should not be construed as legal advice, does not create or constitute an attorney-client relationship, and readers should not act upon it without seeking professional counsel.