Category Archives: Uncategorized

In recently published guidance, Illinois’ main cannabis regulator – the Illinois Department of Financial and Professional Regulation – announced that medical and co-located dispensaries in Illinois must protect patient information in accordance with the stringent privacy and security rules set out in the federal HIPAA statute and attendant regulations.  In particular, medical and co-located dispensaries will be required to undertake a complete HIPAA security risk assessment by December 1,… More

The Cannabis Control Commission announced in an August bulletin that it will begin reviewing all Marijuana Research Facility license applications previously submitted to the Commission.

A Research Facility license allows licensees to research cannabis and cannabis products for a variety of purposes, including under certain circumstances, studies involving human subjects. Research Facility licenses can be held by any number of different entities, including academic institutions, non-profits,… More

As was discussed in detail during Foley Hoag’s recent New Jersey webinar, the adult-use regulations released by the New Jersey Cannabis Regulatory Commission (“CRC”) contain several unanswered questions. For instance, when will the CRC begin accepting applications (they have already missed the statutory deadline)? How will applicants navigate the complexity of the local municipal approval process amidst towns seesawing between opt-ins and opt-outs?… More

New Jersey has finally released its adult-use regulations outlining the manner in which licenses will be solicited, applications scored, and ultimately awarded. With a statutory deadline for the Cannabis Regulatory Commission to begin accepting applications within the next three weeks, preparation is sure to be a sprint. Foley Hoag’s application writing team has written and prepared several winning applications in multiple states, including New Jersey and recently Georgia.

Download presentation materials here.… More

The hemp cannabinoid marketplace has spent the last few years evolving at a fevered pace. However, for the first time in several years, we’re beginning to see a more mature marketplace, market participants, and most importantly, consumers. The market is now engaging in a renewed focus on scaling towards stricter best practices and regulatory frameworks. Please join us as we discuss not only where the marketplace is, but more so,… More

The New Jersey Cannabis Regulatory Commission (“CRC”) – ahead of schedule – just released its adult-use regulations, thereby taking the first step towards opening up its adult-use marketplace. While there is a tremendous amount of information to digest in the 160 pages of regulations, and the myriad implications and questions flowing from it, our cannabis team wanted to provide a brief overview of the relevant implications.

In short,… More

Marketed as a legal way to get stoned, Delta-8 products have been hitting the shelves of gas stations and smoke shops nationwide. But how can a product that purportedly gets users high escape federal and state regulation?

What is Delta-8?

Delta-8 is one of the hundreds of cannabinoids that are naturally found in hemp and cannabis plants. It is an isomer of Delta-9,… More

On Wednesday, July 14, Senate majority leader Chuck Schumer (NY), Senator Cory Booker (NJ), and Senator Ron Wyden (OR) introduced a draft bill to decriminalize marijuana at the federal level. The draft discussion of the legislation, named the Cannabis Administration & Opportunity Act (the “Bill”), opens by recognizing the disparate impact of the War on Drugs on people of color and states that goal of the Bill is to “end the decades of harm inflicted on communities of color by removing cannabis from the federal list of controlled substances and empowering states to implement their own cannabis laws.”

Beyond removing cannabis from the controlled substances list and recognizing state law regarding cannabis,… More

Nearly two weeks after the State Senate first voted on Connecticut’s adult-use cannabis bill, Governor Ned Lamont signed it into law. Starting July 1st, Connecticut will become the 19th state to legalize recreational marijuana for adults 21 and older.

The adult-use bill had a bit of a bumpy ride this June, failing to be voted upon by the State House during the regular legislative session.… More

As of today – June 15, 2021 – the Commonwealth’s State of Emergency related to the COVID-19 pandemic has ended.  Although the Cannabis Control Commission (“Commission”) has issued bulletins and administrative orders that temporarily extend telehealth, virtual community outreach meeting and curbside operations protocols until September 1, 2021, the balance of the Commission’s COVID-19 related protocols have expired.  This may have important implications for Marijuana Establishment Licensees.… More

New York, which only recently passed an ambitious adult-use cannabis bill, has also positioned itself as a leader in the field of hemp cannabinoid products, and just today, May 19, 2021, updated its regulations and standards for the production, distribution, and sale of hemp cannabinoid products in the Empire State.

As many are well-aware, the hemp cannabinoid marketplace has been one of shifting and evolving regulatory oversight.… More

New York’s recent legalization of recreational marijuana for adult use has set off a flurry of entrepreneurial activity as businesses seek to establish a foothold in the State’s new and lucrative market. Renewable energy, energy storage and other technologies can help growers not only minimize their electricity bills – a substantial operation expense for the typical indoor farm – but also give them a leg up in the State’s licensing process.… More

With much of the cannabis oriented media focusing on the flurry of adult use bills and opportunities, it is easy to overlook that many states are doubling down on their medical marijuana infrastructure. For instance, over just the last few weeks, the Ohio Board of Pharmacy (“Board”) began its efforts at more than doubling its number of medical marijuana dispensaries. Ohio anticipates commencing an application round soliciting up to 73 additional dispensaries at some point in the “spring/summer 2021.”

Ohio has seen tremendous growth in its patient population up to 136,507,… More

With barely half of 2021 gone by, the wave of cannabis legalization continues with Alabama poised to become the 37th state with a lawful medical marijuana program. In particular, on May 6, 2021, the State Legislature voted to legalize medical marijuana, with the Governor still in the process of “reviewing,” though anticipated to sign in light of the bipartisan and strong margins through which the underlying Bill passed (68-34 and 20-9 respectively).… More

On April 19, the U.S. House of Representatives passed the Secure and Fair Enforcement (SAFE) Banking Act in a 321-101 vote. The bill has benefitted from bipartisan support after being co-sponsored by a large group of both Democrats and Republicans in the House. Only one representative, Rep. Patrick McHenry of North Carolina, spoke in opposition to the bill during the House debate. The SAFE Banking Act will next move to the Senate.… More

The New Jersey Cannabis Regulatory Commission (“CRC”) has finally come into existence, and now, the hard work begins.

By way of background, the CRC was created by statute as part of New Jersey’s medical cannabis expansion law, though the full roster of commissioners was only recently appointed. The CRC will oversee both the medical and adult-use cannabis marketplace, and is tasked by New Jersey’s adult-use implementation law with creating the rules and regulations that will govern the structure and scope of the adult-use.… More

New Mexico has recently followed the likes of Arizona, New Jersey, Virginia, and New York in becoming the 17th state to legalize adult use cannabis. Indeed, New Mexico became the second state in 24 hours to legalize adult use cannabis, following New York’s efforts the day before. Specifically, HB 2, passed the Senate and House by a vote of 22-15 and 38-32 respectively.… More

The SAFE Banking Act is back. First introduced in 2019, the Secure and Fair Enforcement Act (“SAFE”) passed in the House but died in the Republican-controlled Senate. Now, the bill has been reintroduced in both the House and the Senate with bipartisan support, as well as support from the American Bankers Association. Despite broad support, it remains unclear – and probably unlikely – the legislation could move as a standalone bill without accompanying removal of cannabis from the schedule of controlled substances and restorative justice provisions to expunge or pardon past cannabis offenses.… More

New York has been the most recent focal point of adult-use legalization activity following news last week that the Governor and Legislature have seemingly come to consensus on an adult use legalization bill. Just this weekend, the New York State Legislature made public its drafts of S854 and A1248, with a goal of passing these bills and signing them into law sometime this week.… More

On the heels of recent legalization and/or implementation efforts in states like Virginia, New Jersey, and Arizona, New York is now positioned to become the 17th state in the country to legalize adult use cannabis.

Assembly Majority Leader Crystal Peoples-Stokes, D-Buffalo, the sponsor of A.B. 1248, the Marijuana Regulation and Taxation Act (“MRTA”), has indicated that the New York Legislature will vote on a cannabis legalization bill sometime next week.… More

Prior to his Judiciary Committee confirmation hearing last week, Judge Merrick Garland had not clarified his views on marijuana policy and how he would approach the issue if confirmed as Attorney General. However, after his confirmation hearing, we can almost certainly expect to see the Justice Department shifting back towards the Obama-era approach and limiting resources spent on federal marijuana enforcement.

During the first day of the confirmation hearings last week,… More

New Jersey Cannabis had itself a week. Following a recent decision permitting the New Jersey Department of Health, Medical Marijuana Division (“DOH”) to continue scoring its 2019 Request for Applications (“2019 RFA”) and award twenty-four (24) additional medical cannabis licenses, New Jersey doubled down; with Governor Murphy not only signing into law the adult-use enabling legislation, but also finally appointing the remainder of the Commissioners to the five (5) person Cannabis Regulatory Commission (“CRC”).… More

Special purpose acquisition companies (SPACs) have been gaining traction as one of the most popular exit strategies over the last year. They have been pitched as an easier way to go public because of the ease of working with one partner versus the large courting that typically happens with an IPO. But…is it too good to be true? Is this a fad or is it here to stay?

Our webinar panelists provide an overview of what a SPAC is,… More

As many are well-aware, the Cannabis Regulators Association (“CANNRA”) was formed at the end of 2020 with the goal of sharing institutional knowledge and regulatory best practices in order to assist federal, state and local jurisdictions that have approved or are considering approving the legalization of cannabis. The goals and collective wisdom of a body like CANNRA have only become all the more important with growing discussions as to whether and in what format cannabis should be legalized at the federal level.… More

“The stay previously entered by this court is hereby vacated.”

As many are well-aware, the cannabis industry has been plagued by litigation, and New Jersey’s recent experience is no different. Indeed, New Jersey has taken great strides to expand its medical marketplace, with the patient population recently eclipsing 100,000 total patients. Moreover, the New Jersey Department of Health, Medical Marijuana Program (“DOH”) was on pace towards expanding access and production to meet this patient demand,… More

The Virginia General Assembly is currently considering adult use cannabis legalization this session. Governor Northam has made it a priority. The legislative black caucus has endorsed it and the legislative sponsors in both chambers are senior members of their caucuses.

However, there remain a few hurdles to passing this legislation.

First, the adult use legislation does not guarantee adult use cannabis licenses to the existing medical cannabis operators in the Commonwealth.… More

As we previously blogged, “agricultural employees” are excluded from coverage under the federal National Labor Relations Act, which governs unionization.  The National Labor Relations Board’s Division of Advice (which determines which cases to prosecute) has now weighed in for the first time as to what this means for cannabis grow workers.  In an opinion just released, the Division of Advice found that workers in an indoor greenhouse are excluded from the NLRA’s coverage because they “substantially engage in the primary agricultural functions of harvesting,… More

The Cannabis Control Commission has filled its last vacant seat, ending a prolonged stretch without a full roster of Commissioners.  Filling the void left by Commissioner McBride’s resignation late last year, Governor Baker, Treasurer Goldberg and Attorney General Healey recently appointed Ava Callender Concepcion as the Commission’s newest member.  A Dorchester native and graduate of New England Law School, Concepcion joins the Commission from the Suffolk County District Attorney’s Office where she most recently served as Director of Governmental Affairs and External Partnership. … More

For the first time in nearly a decade all three branches of the Federal Government are controlled by Democrats. The Democratic Party has a plethora of agenda items it is looking to enact within this unified government. One of those policy issues is the federal legalization of cannabis.

House Democrats recently passed the MORE Act, which would federally legalize cannabis. The House leadership intends to re-introduce the MORE Act and pass it in short order.… More

Unlike states like South Dakota and New Jersey, who are experiencing stumbling blocks with respect to the implementation of their voter backed adult-use cannabis referendums, Arizona has already hit the ground running. By way of background, Arizona’s Proposition 207 was passed by 60% of voters, and broadly legalized the possession and use of marijuana for adults aged 21 years and older,… More

Though the final results of the 2020 presidential race took a few days to become clear, it was obvious by the morning of November 4 that cannabis legalization had run the table: from deep red Montana, South Dakota, and Mississippi, to purple Arizona, and blue New Jersey, voters overwhelmingly favored state ballot initiatives to legalize adult use and medical cannabis.  The same Election Day, California voters approved an aggressive expansion of the California Consumer Protection Act (the “CCPA”) (already among the strictest state privacy laws) into the California Privacy Rights Act,… More

As the pages of the calendar turn to January and turbulent 2020 comes to a close, new faces will be taking their posts on the Commonwealth’s Cannabis Control Commission. Beginning in January, Nurys Z. Camargo and Bruce Stebbins will begin 5-year terms as Commissioners, after Governor Baker, Treasurer Goldberg and Attorney General Healey recently announced their appointments.  Camargo will be replacing Commissioner Shaleen Title, whose term ended on August 31,… More

Last Friday, the U.S. House of Representatives took the historic step of voting on and passing the MORE Act. The legislation would legalize cannabis within the United States and remove criminal penalties associated with cannabis. Although the law has little chance of passing the U.S. Senate by years end, the vote in favor of this bill cannot be overstated. First, it ends the decades old probation of cannabis, thus federally legalizing the use of cannabis in the United States where 2 out of 3 Americans already live in states where cannabis is legal.… More

What do baseball umpires, war and peace, cannabis, and relative error all have in common? A lot in the opinion of the Superior Court of New Jersey, Appellate Division (“Appellate Division”), which issued a ruling today related to the 2018 Request for Applications (“RFA”). While much is addressed in the seventy-five (75) page decision, the net effect is this: the New Jersey Department of Health (“DOH”) – or,… More

Regulators from 19 states have joined together in forming the Cannabis Regulators Association (“CANNRA”). The goal of CANNRA is to share institutional knowledge and regulatory best practices in order to assist federal, state, and local jurisdictions that have approved or are considering the legalization of cannabis. CANNRA is not an advocacy group, nor does it take a position either for or against cannabis legalization, but instead is designed as an informational clearinghouse to help regulators make informed decisions in creating,… More

As the saying about real estate goes, it’s all about “location, location, location.” The same rule holds true and carries substantial weight when determining where to locate your business in the competitive New Jersey cannabis licensing process – both for medical, and as anticipated to continue in the adult use cannabis program. As a result, a common question we as practitioners are asked is “what towns should I be looking in?” So why does location matter in the cannabis licensing process in New Jersey,… More

The race for who will be America’s next President remains a cliffhanger as of early evening on November 4. Many observers thought this election would be a clear-cut win for former Vice President Biden but turned out to be significantly closer than most people imagined with the outcome still unknown and with many votes still left to be counted.

However, one election outcome that was unanimously clear is the one that occurred in five states that had ballot measures regarding the legalization of cannabis for adult and medical use.… More

In a recent decision, the Regional Director of the National Labor Relations Board (NLRB) for Region 1 (covering most of New England) found that a majority of employees of a cannabis cultivation and processing facility were “agricultural laborers” within the meaning of the National Labor Relations Act (NLRA) and therefore not subject to the jurisdiction of the NLRB.  The decision means that the union can attempt to organize the workers pursuant to Massachusetts law,… More

There has been a significant amount of political punditry over the last several months about an electoral “Blue Wave” coming this November. President Trump is at historical lows of job approval and favorability and much of today’s public polling points towards a Democratic sweep at the ballot box in two weeks’ time. In fact, according to FiveThirtyEight, the online data and analytical website, former Vice President Biden has an 87% chance of winning the Presidency;… More

New Jersey is an emerging cannabis marketplace with a litigation problem. Litigation is not uncommon for competitive application rounds, and unfortunately, New Jersey’s 2019 request for applications (the “2019 RFA”) for twenty-four (24) medical alternative treatment centers (“ATCs”) (inclusive of four (4) vertically integrated permits, five (5) cultivation permits, and fifteen (15) dispensary permits) has been held up for close to a year due to a challenge by a few disqualified entities that subsequently obtained a stay of the process from the Superior Court of New Jersey,… More

Cannabis is on the ballot in New Jersey for the November 3, 2020 election (the “Referendum”), but what does that actually mean? Assuming it passes, does that mean I can grow at home? Open my own shop? Sell at my leisure? This article will briefly address what the Referendum does address, what it does not, and where the State, citizens, and entrepreneurs go from here.

As many are painfully aware,… More

The Garden State’s cannabis marketplace is finally on the verge of coming into full bloom. While New Jersey has been perpetually on the verge of something big in cannabis over the last several years, where is New Jersey now and where is it going? With a medical marketplace poised to eclipse over 100,000 patients in the coming months, and the voters of New Jersey on the precipice of passing adult-use cannabis by referendum on November 3,… More

The Green Mountain state has taken a significant step toward legalizing recreational cannabis.  On September 17, 2020, the Vermont House of Representatives adopted the Conference Committee report for S.B. 54, an act relating to the regulation of cannabis.  The Conference Committee has had custody of the bill since early this year and was tasked with reconciling the significant differences between the bill and a similarly-intentioned, but substantively different,… More

Illinois’ widely-watched application process for handing out 75 adult-use cannabis dispensary licenses has now wound up in federal court, following the September 4, 2020 filing of a lawsuit by several unsuccessful applicants.  The state on September 3, 2020 announced its intention to complete the licensing process – which had already been delayed several months – through a lottery including 21 of the roughly 700 dispensary applicants.

Many of the plaintiff applicants are owned by veterans,… More

The Office of Cannabis Business Regulation within the Rhode Island Department of Business Regulation is currently accepting applications for six new Compassion Center licenses.  One license will be awarded for each of the six zones delineated in the license application materials, and applicants must apply for a license in a specific zone.  The application period commenced on July 17, 2020 and will remain open until 3 p.m. on December 15,… More

On August 28, 2020, the Cannabis Control Commission held a meeting to discuss the public comments on proposed amendments to the Commission’s adult-use and medical marijuana regulations.  By way of background, the Commission posted draft regulatory amendments in late July, hosted a public hearing on the amendments on August 3rd and accepted written public comments on the amendments until August 15th.  Since the 15th, the Commissioners and staff have reviewed all of the public comments and considered whether any warranted reconsideration of,… More

Spurred by Commissioner Kay Doyle, the Cannabis Control Commission has solicited public comments on whether it should dismantle the vertical integration model for Marijuana Treatment Centers in the Commonwealth.  In a formal public notice dated August 11, 2020, the Commission explains that it will be considering whether to allow vertically-integrated MTCs to, subject to existing licensing caps, apply for certain adult-use endorsements, including cultivation, marijuana product manufacturing, or retail endorsements,… More

The Massachusetts Cannabis Control Commission has published an ambitious regulatory update of both adult use regulations at 935 CMR 500.000, medical marijuana establishment regulations at 935 CMR 501.000, and co-located adult-use and medical-use marijuana regulations at 935 CMR 500.000.  The CCC is holding a virtual public hearing on August 3, 2020 at 10:00 AM, and accepting written comments on the regulations up through August 14, 2020 at 5:00 PM.… More

As part of sweeping recommendations touching upon subjects ranging from climate change to criminal justice reform to healthcare, the Biden-Sanders Unity Task Force Recommendations recently previewed a framework for federal cannabis regulation under a Biden administration.  Although the framework is thin on details, it reaffirms the widely-held belief among Democrats that the federal government should decriminalize cannabis and take affirmative steps to erase the scars of past criminal convictions arising from cannabis use.… More

On June 24, John Elias, a former Acting Chief of Staff to the United States Assistant Attorney General for the Antitrust Division, testified in front of the U.S. House of Representative’s Judiciary Committee that last year the Antitrust Division had investigated ten cannabis mergers and the California/automakers emissions agreements based on political pressure from Attorney General Bill Barr and not based on any concerns about harm to competition.… More

In September 2019, Metrc, a prominent cannabis seed-to-sale tracking company, filed suit against the Missouri Office of Administration (OA) requesting the ability to charge additional fees beyond those specified in its contract with the state.

In April 2019, Metrc was awarded a five-million-dollar contract to oversee three of Missouri’s medical marijuana programs. Metrc was one of  20 bids for the contract. The Missouri Division of Purchasing advised bidders to provide “firm,… More

In November 2019, the Massachusetts Cannabis Control Commission (CCC) released new regulations dictating that Marijuana Cultivators engaged in indoor cultivation must include a report of their energy and water usage over the 12-month period preceding the date of their license renewal applications. This requirement is outlined in 935 CMR 500.103(4)(c). All applications for renewal filed on or after July 1, 2020 must include this required documentation.

The Cannabis PowerScore is specified by the Massachusetts CCC as an approved form and manner for reporting energy and water performance.… More

The Boston Cannabis Board on June 24, 2020 held a virtual public meeting addressing the current state of adult use marijuana licensing in the City of Boston.  Established by a City Council ordinance in November 2019, the Board was intended to bring additional clarity and transparency to cannabis licensing in Boston.  Chairwoman Kathleen Joyce stated that the Board sought to ensure a “clear, predictable, and transparent process” for businesses seeking a license,… More

During a Cannabis Control Commission (“Commission”) regulatory policy discussion on June 19th, Chairman Steven Hoffman confirmed the Commission’s plans to publish draft revised regulations within the next few weeks and to vote on final regulations by the end of August. The revisions will address numerous issues that the Commission has identified since it updated its regulations last fall, including proposing new requirements for vape products and establishing a permitting process for cannabis research projects.… More

Massachusetts Governor Charlie Baker announced today that Massachusetts adult-use cannabis retail stores will be allowed to re-open for curbside pickup beginning on Memorial Day.  The announcement was a part of the Governor’s comprehensive plan for re-opening businesses across the Commonwealth, which includes mandatory workplace safety standards, sector-specific protocols, and a phased approach to reopening businesses.

Phase 1 of the Governor’s reopening plan allows retail businesses of all types to conduct curbside pickup beginning on Memorial Day. … More

When Maine enacted the Marijuana Legalization Act in 2018 the legislature included one of the most stringent residency requirements in the nation.  In order to obtain a license, an applicant had to be majority owned by individuals who were Maine residents for the past four years.  Earlier this week Maine’s Attorney General conceded that the residency requirement was likely unconstitutional and Maine’s Office of Marijuana Policy announced that it would no longer enforce the requirement.… More

The Massachusetts Appeals Court has vacated a preliminary injunction issued in January by a Superior Court judge to prevent the City of Cambridge from enforcing an ordinance that delays medical cannabis facilities (“MTCs”) from converting to adult-use facilities.  The Appeals Court’s order in Revolution Clinics II, Inc. v. City of Cambridge was issued by a single justice on April 24, 2020, and reverses the Superior Court on narrow grounds.… More

On March 30th, the Treasury Inspector General for Tax Administration (“TIGTA”) released a report which concluded, based on its estimates, that the IRS could have collected significant additional tax revenue from cannabis companies if IRS audits of such companies were increased.  In particular, TIGTA reported on potential income tax deficiencies arising from the denial of business deductions and credits under Internal Revenue Code Section 280E.

As a general matter,… More

On April 20, United Cannabis Corporation filed a Chapter 11 bankruptcy petition for reorganization in Colorado.  The Bankruptcy Court for the District of Colorado has previously dismissed bankruptcy cases for marijuana businesses due to the substances’ federally illegal status.  In In re Rent-Rite Super Kegs W. Ltd., 484 B.R. 799 (Bankr. D. Colo. 2012), the court found that there was “cause” under 11 U.S.C. § 1112(b) to dismiss the debtor’s Chapter 11 case because the debtor was violating the Controlled Substances Act by renting space in its warehouse to parties who were growing marijuana. … More

A Massachusetts Land Court judge has ruled that a Mansfield RMD license-holder can use its property for adult-use sales even though the property is not locally zoned for adult-use sales. The Land Court’s decision provides strong authority for RMDs provisionally licensed before July 1, 2017 who would like to expand to adult-use operations.

The case is Rosenfeld v. Town of Mansfield. Rosenfeld and her licensed RMD,… More

Last week, Governor Baker issued a COVID-19 Essential Services Order establishing which businesses in the Commonwealth may remain open as “essential” while most of our commerce, unfortunately but necessarily, shuts down in order to slow the deadly Coranavirus pandemic.  Medical Marijuana Dispensaries and Liquor Stores made the cut.  Adult use cannabis did not.

Following suit, the Cannabis Control Commission issued a Summary Cease and Desist Order that (1) allows medical marijuana activity to continue unabated (separately,… More

The Cannabis Control Commission announced on March 20, 2020, that healthcare providers registered with the CCC to prescribe medical marijuana will have the option to issue prescriptions to new patients following a telehealth consultation.  This new guidance is a departure from the CCC’s regulations, which require patients to be physically present for a clinical visit in order to receive a prescription.  See 935 CMR 501.0101(7). … More

The global outbreak of COVID-19 is disrupting lives and businesses across the world, and the cannabis industry and its customers are no exception.  Our new reality is not only of great financial concern, but also presents serious public health challenges.  Cannabis patients, of course, need to maintain access to essential medicine.

While many states have rightly concluded that medical marijuana dispensaries are an “essential service” that may remain open during shutdowns in the same manner as pharmacies,… More

Rhode Island Governor Gina Raimondo’s fiscal year 2021 budget includes over $20 million in revenue that the Governor expects to be generated by legalizing cannabis for recreational use.  While the Governor’s support for legalization is welcomed news for the industry, there is a twist: dispensaries would be owned by the state and run by private operators, much like how states such as New Hampshire structure the sale of liquor.

The proposal calls for retail revenues to be split between the state (61%),… More

On Tuesday, I blogged about H 4367, a bill that would amend the statutory language that defines permissible scope of community impact fees in Host Community Agreements (“HCAs”) and would grant to Cannabis Control Commission authority to regulate HCA.  Soon after I posted the blog, the House passed the bill with two substantive amendments.

The first amendment, offered by Representative Kane, clarifies that while the 3% community impact fee is the only fee a locality can collect in an HCA,… More

A bill that would amend the statutory language that defines permissible scope of community impact fees in Host Community Agreements (“HCAs”) is making its way through the Massachusetts State House.  The bill, H 4367, would also give the Cannabis Control Commission (“CCC”) express regulatory authority over HCAs.

The issue the bill addresses is one that has created considerable uncertainty and controversy.  Under Massachusetts law,… More

On November 4, Maine’s Office of Marijuana Policy (“OMP”) finalized its Adult-Use Marijuana Program regulations and announced that it would begin accepting applications for adult-use licenses on December 5. The regulations establish six types of cultivation licenses ranging from 500 to 20,000 square feet of canopy; a product-manufacturing license, and a marijuana store (i.e., retail) license.

The OMP has not capped the number of licenses it will issue for cultivators,… More

The U.S. Department of Agriculture (“USDA”) released draft regulations for hemp production on Tuesday, giving farmers, states, and other industry stakeholders some much needed clarity on how the hemp provisions of the 2018 federal farm bill will be interpreted and enforced.

Once the interim rule is finalized, the USDA will begin to accept and review states’ and tribes’ hemp regulation plans. The plans must at a minimum provide for tracking of land where hemp is grown;… More

The ink is barely dry on the New Jersey ATC and Missouri medical marijuana facility applications that so many of us assembled this August. Yet now, a new round of states have issued applications for competitive cannabis licenses. Below we discuss the qualifications, requirements, deadlines and other relevant information for the Illinois (adult use), Michigan (adult use) and Texas (medical; <.5% THC) applications.

Illinois
Dispensaries

The Illinois Department of Financial and Professional Regulation (“IDFPR”) has posted its application form for conditional adult-use licenses for new dispensing organizations.… More

California is the largest cannabis market in the United States and it is soon to be the first state in the country with a comprehensive data privacy regime designed to protect consumers’ personal information. The California Consumer Privacy Act (“CCPA”) goes into effect on January 1, 2020, and will apply to companies with revenues in excess of $25 million that do business in California (as well as certain other categories of companies).… More

Massachusetts Secretary of State Bill Galvin and his Securities Division are increasingly turning their attention toward securities offerings in the cannabis industry, as demonstrated by the June 19, 2019 filing of the second enforcement action against a cannabis business in the last two months.  The filing was accompanied by a statement from Galvin warning of future sweeps in the industry.

The latest enforcement action, brought against Positronic Farms,… More

Cresco Labs announced this week that United States antitrust regulators are seeking additional information about its anticipated acquisition of Origin House. Pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, Cresco Labs was required to notify the U.S. Department of Justice Antitrust Division (the “Division”) of the transaction and to observe a waiting period while regulators reviewed the transaction. On June 10, the Division requested additional information regarding the proposed transaction.… More

The New Jersey Department of Health’s Medical Marijuana Program announced on Monday that it was seeking applications to license up to 108 additional Alternative Treatment Centers (ATCs). More specifically, the Department intends to license up to 24 cultivators, 30 manufacturers, and 54 dispensaries.  The cultivator licenses will be divided into three different size categories: 5,000 square feet, 20,000 square feet, and 30,000 square feet. The purpose of sub-dividing the cultivation licenses by size is to create opportunities for small and medium-sized businesses to participate in the medical marijuana program.… More

Last month, the House Financial Services Committee advanced a federal marijuana banking bill to the full House on a bi-partisan 45 to 15 vote. The “Secure and Fair Enforcement Banking Act” or “SAFE Banking Act” would prevent federal banking regulators from taking adverse actions against financial institutions solely due to an institution’s provision of financial services to state-legal cannabis businesses. The bill would also provide protections for financial institutions that do business with cannabis-industry service providers by declaring that proceeds from such providers do not constitute “proceeds from an unlawful activity.” And,… More

There is no business quite like cannabis, and very few that need constant attention to regulatory compliance in every aspect of operations. Friend of the blog and Director of Legal Compliance at Acreage Holdings, Gary Kaminsky, penned an excellent column recently for Law360 suggesting cannabis companies should implement regulatory Enterprise Risk Management (“ERM”) principles. The column can be found here: A Holistic Approach To Compliance For Cannabis Cos. –… More

On November 29, a U.S. Tax Court judge confirmed that § 280E of the Internal Revenue Code prevents state-legal cannabis businesses from deducting ordinary and necessary business expenses from their federal taxes. The ruling is a blow to businesses in the cannabis industry, who incur significantly higher federal tax burdens than they otherwise would if, like other businesses, they were allowed to deduct their business expenses.

Section 280E declares that “[n]o deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business .… More

With July 1st now fully in the rear-view mirror, we thought it would be a good time to update you on the latest developments at the Cannabis Control Commission.  Earlier this month, the Commission approved two final retail licences for businesses in Northampton and Leicester.  These represent the very first final adult-use retail licenses awarded in the Commonwealth.  With this, Massachusetts residents should expect adult-use retail shops to open to the public within a matter of weeks. … More

Banker & Tradesman interviewed partner Kevin Conroy about the relationship between financial institutions and the marijuana industry. Click here to read on Scribd.

Reprinted with permission from July 23, 2018 More

With the first retail sales of adult use marijuana slated to take place in just over five months, the Massachusetts Cannabis Control Commission (the “Commission”) is working overtime to regulate an industry that some project will exceed $1 billion in revenue by 2020.  As the July 1st target date for the opening of retail cannabis shops approaches, one area that will undoubtedly become the focus of much attention is the ability of retailers to market their wares. … More

Despite a less-than-friendly administration, a number of federal cannabis bills have recently been introduced to Congress. Here is a list of bills marijuana business owners should be keeping an eye on:

The Marijuana Justice Act

S.1689, sponsored by Senator Cory Booker (D-New Jersey), introduced August 1, 2017.

About: Booker’s bill would exempt cannabis from the Controlled Substances Act (CSA),… More

The long awaited amendments to the medical marijuana regulations are finally final.  The draft amendments to 105 CMR 725.000, Implementation of an Act for the Humanitarian Medical Use of Marijuana, were made available for comment more than a year ago.  The amendments accomplish much, such as allowing certified nurse practitioners to certify qualifying patients, certifying institutional caregivers without individual employee certification, streamlining and bifurcating the application/registration process for RMDs,… More

The Department of Public Health this week released guidance that paves the way for RMDs, which prior to the new legislation adopted this summer had to be organized as not-for-profit corporations under Chapter 180, to convert to for-profit corporate entities. The green light from DPH is a blessing for RMDs who, by virtue of the nonprofit requirement, were forced to adopt complex corporate structures. The Guidance can be found here.… More

One Day after being ruled “out of order” by House leadership, Marijuana Business Daily is reporting that the Rohrabacher-Blumenauer Amendment has been extended in the House Budget and temporary hurricane aid package through December 2017.

Since 2015, the Amendment has been consistently attached to federal spending measures passing Congress and signed by the President. The Amendment prohibits the Department of Justice from expending any funds to enforce any law that interferes with a state’s implementation of its own medical marijuana laws.… More

State House News is reporting that Treasurer Deb Goldberg has named former Bain and Company partner Steven Hoffman as Chair of the about-to-be-formed Cannabis Control Commission. When all is said and done, the CCC will regulate all things cannabis in the Commonwealth, including the regulated adult use market and the existing medical marijuana program. Like Gov. Baker’s pick, former Sen. Jennifer Flanagan, Mr. Hoffman voted against Question 4 in November.… More

Governor Charlie Baker signed the legislative overhaul of last November’s referendum legalizing the licensed sale and cultivation of adult use cannabis.  We summarized many key details of the bill here.

We have 8 short months until applications are due, although what those applications will require, how far along in the painstaking local zoning process applicants must be, how clear of an advantage licensed medical operators and applicants will have,… More

No sooner said than done, the long-awaited conference committee bill amending Chapter 334 of the Acts of 2016 (the adult use cannabis referendum) has been released.  Our complete summary of the new legislation and a comparison to the referendum’s original language can be viewed here:

Summary of Cannabis Legislation

Some big picture highlights:

(1) The referendum’s one year head start for many medical marijuana licensees has been eliminated. … More

We are more than two weeks now since the passage of the House and Senate’s competing legislation overhauling the framework regulation and taxation of adult use cannabis adopted by Massachusetts voters in November. In general, the Senate hewed closer to the language and intent of the referendum, while the House repealed the voter-passed law in its entirety in favor of a total rewrite.  Then three legislators from each chamber were swiftly appointed to a conference committee to reconcile the two competing bills into final legislation.  … More

The Joint Committee on Marijuana Policy today voted to advance, over objection and disapproval, a bill that repeals the 2012 Medical Marijuana law and 2016 Adult Use laws in Massachusetts — both passed by referendum — in their entirety. Our summary of the major points can be viewed by clicking this link House Bill Summary.

In its place, a House Bill sent out of committee imposes many changes including a 28% tax rate (up from 12%) on adult use licensees;… More

Last month, we noted that a significant number of Massachusetts towns and cities were already enacting bans or temporary moratoria against recreational marijuana sales, even though it will be months before the first adult-use operators are even eligible to apply for licenses. Now the legislature may be doing something about that trend. Senate President Stanley Rosenburg (D.) said that lawmakers were considering whether there is a way to incentivize more communities to say ‘yes’… More

Nevada’s adult use referendum passed the same day as Massachusetts voters ushered in the Commonwealth’s adult use law. From there, the states took two very different paths.

Both states contain a “head start” for medical licensees to begin sales, as we’ve discussed here and here.

Well, wanting to keep its boot on the neck of the black and gray markets and begin collecting revenue,… More

Months before the first adult-use cannabis operators are eligible to apply for licenses, a significant number of cities and towns are passing (1) temporary moratoria on local zoning approvals of any such facilities; or (2) permanent outright bans.  According to the Massachusetts Municipal Association, 39 municipalities have thus far enacted temporary moratoria, while at least 10 have passed outright prohibitions.  “Dozens” more municipalities are expected to vote on such measures soon.… More

Out of nowhere, Sen. Patricia Jehlen, chair of the Joint Committee on Marijuana Policy, tells the Boston Globe that she wants to eliminate the one-year head start that the adult use referendum gives to experienced medical marijuana operators to apply for licenses. She tells the Globe:

But there are areas where Jehlen is keen to see the law changed. One is leveling the playing field, so medical marijuana companies don’t have what Jehlen called “an artificial leg up” in the retail market.… More

The Boston Globe reports that the Legislature is very likely to strip the State Treasurer of Authority to appoint and oversee the Cannabis Control Commission in favor of an “independent” Commission funded by licensing fees and appointed by various state elected officials. The model appears to be the controversial Massachusetts Gaming Commission.

I explained here why the Gaming Commission is not a good model for the regulation of cannabis in the Commonwealth.… More

This week, State Treasurer Deborah Goldberg wrote to U.S. Attorney General Jeff Sessions seeking clarity on the federal government’s “intentions” before the state “commit[s] significant public resources to implementing Massachusetts’ recreational marijuana laws.”  She’s not alone on seeking clarity as Attorney General Sessions’ public and reported statements have been anything but consistent and specific (see here and here and here, but also here).… More