New York Dispensary Owners File Lawsuit Against Regulators Over Proximity Snafu

A group of cannabis dispensary owners filed a lawsuit against New York State regulators last week, contending that they could be forced out of business because their storefronts are too close to schools despite being approved by regulators, the New York Times reports. In July, nearly 200 Conditional Adult-Use Retail dispensary license holders were informed by the Office of Cannabis Management that their businesses’ location “is in violation” of the state’s cannabis law. 

The lawsuit, filed in the State Supreme Court, seeks to block the proposed proximity rule correction and deem the businesses compliant under the previous interpretation that allowed them to open the business at the approved location despite it running afoul of the law.

In the letter to businesses, OCM Acting Director Felicia A. B. Reid Esq apologized and said she was “keenly aware” that the information would have “repercussions” for the business owners. Reid added that while the affected businesses are “not presently required to change” location, it “will become an issue at the time of license renewal.” 

“OCM cannot use the past unlawful standard of review to consider a license upon renewal,” the letter states. 

A bill to correct the regulatory error and grandfather in impacted businesses was introduced on August 4. It is currently in the state Senate Rules Committee.