LOCAL NEWS
JUDGE : MAINE DISPENSARY RULE (Still ) Unconstitutional
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state law that prevented nonresidents from operating medical Cannabis dispensaries in Maine has been overturned. A federal judge ruled that the state’s residency requirement is unconstitutional. The lawsuit, which was brought by Wellness Connection, will open medical marijuana businesses to out-of-state companies and investors. The Wellness Connection is Maine’s largest dispensary chain but its parent company, High Street Capital Partners, is headquartered in Delaware. If this sounds familiar, it’s because it’s the third time Wellness Connection has successfully defeated Maine’s residency requirement in court. The company previously challenged the constitutionality of the requirement for the state’s adult-use market in March 2020. Later that year, Wellness Connection sued the city of Portland for giving retail-licensing preference to state residents. In each case, the same legal argument was used. And in each case, a judge ruled that Maine’s residency requirement was unconstitutional. The requirement was included in the state’s marijuana law when medical dispensaries launched in 2011. It called for applicants to live in Maine and have filed income taxes there for four years. The in-state preference was intended to garner support for legalization by creating jobs and entry to the industry for residents. However, U.S. District Court Judge Nancy Torresen found that the requirement for medical Cannabis dispensary operators discriminates against interstate commerce, a violation of the “Dormant Commerce Clause” in the Constitution.
Photo by Marco Jimenez
There’s big money at stake for investors as marijuana is Maine’s biggest cash crop. The state has set records for recreational Cannabis sales in four consecutive months. Retail sales reached $9.4 million in July, as Maine approaches $40 million in adult-use sales since the program began in October 2020. However, medical marijuana is still king in Maine, as sales to qualified patients topped $22 million in October 2020 alone. From January through October 2020, the state’s medical Cannabis sales brought in over $221 million. Now, thanks to a string of successful lawsuits filed by Wellness Connection, investors from any state can take advantage of Maine’s booming marijuana business.
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Photo by Tatiana Fet
ndrew Cuomo announced in August that he would resign as governor of New York amid mounting pressure for him to step down after state Attorney General Letitia James issued a report that found that Cuomo sexually harassed 11 women. Cuomo will leave office without having done much to establish the state’s legal Cannabis industry, beyond signing the adult-use legislation into law in March 2021. New York has struggled to implement its retail marijuana program as Cuomo
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failed to make essential regulatory appointments, which caused the legal pot market to stall. The state’s marijuana law calls for the creation of an Office of Cannabis Management, as well as a Cannabis Control Board. These regulatory bodies are responsible for creating rules for the adult-use industry, including licensing for cultivators and retailers. As the boards remain unfilled, the state is wasting precious time while other programs in the region get up to speed. Now that Cuomo has resigned, retail sales in New York could be further delayed. The state was already looking at a start date in 2022. It is possible that the turmoil surrounding the governor’s office could cause adult-use sales to be delayed until 2023. Legislators worked hard to pass a timely recreational Cannabis law that would make New York competitive with neighboring New Jersey. However, a retail start date in 2023 could put the state a year behind New Jersey, which anticipates launching sales in early 2022. However, some industry experts see Cuomo’s departure as a positive for pot. Cuomo was seen by most Cannabis advocates as “reluctantly supporting” legal weed. While he ultimately worked with lawmakers to pass an adult-use bill, some viewed his support as opportunistic. Legalization did replace his scandals in the headlines – but only briefly. Cuomo will be replaced by Lt. Gov. Kathy Hochul. Time will tell whether she makes legal pot a priority – or pushes it to the backburner while dealing with the mess left by her predecessor.
