NY: Judge: Marijuana licensing ‘failed to follow’ law

The Times Union reports

ALBANY — New York’s beleaguered rollout of a recreational marijuana marketplace was dealt a significant blow Friday when a state Supreme Court justice issued an injunction that will block regulators from processing new applications for retail licenses under a program that the judge said is in “legal jeopardy.”

State Supreme Court Justice Kevin R. Bryant found that marijuana regulators had “failed to follow the clear language of the applicable legislation” that legalized cannabis when they veered from the plain language of the 2021 statute and created a program to award conditional retail licenses exclusively to applicants with past marijuana convictions.

Bryant’s ruling noted that New York regulators continued their preferential licensing program, and even expanded it, in the face of mounting legal challenges asserting that it was unlawful and violated the constitutional rights of other “social equity” applicants, including minority- and women-owned businesses, as well as disabled military veterans.

The injunction issued by Bryan will not apply to pending applicants who met all licensing approvals prior to Aug. 7. His order also directs the state Cannabis Control Board to promptly finalize its regulations for recreational marijuana. The judge’s ruling also allows for applicants to seek court intervention on a “case-by-case” basis.

The ruling was issued in response to a lawsuit filed this month by four service-disabled veterans who accused regulators of unlawfully prioritizing applicants with prior drug convictions while excluding others. The state had asserted that regulators had the authority under the law that legalized marijuana to create a special class of licenses, but Bryant said in his ruling that there is a “significant likelihood” that they will lose that argument.

New York’s attorneys also had argued that the Legislature recognized their new conditional licensing program by including funding for it in a budget bill, which the state argued was the equivalent of statutory authority. But the judge said that acknowledgment was not the same as amending the licensing section of the Marijuana Regulation and Taxation Act.