25 May 2016
It’s a setback for cannabis businesses in the United States – but it may be just a temporary one.
MassRoots, a social platform where users “share cannabis experiences, meet like-minded people in your area, and stay up to date with local dispensaries and businesses,” received word yesterday that their application for listing was denied. They filed the application in August of last year.
The Nasdaq determined the cannabis platform, which has 900,000 users, could be seen as “aiding and abetting” the distribution of a plant that remains illegal under federal law. In a statement, MassRoots CEO Isaac Dietrich described the decision as a “dangerous precedent” that stands to “prevent nearly every company in the regulated cannabis industry from listing on a national exchange.”
Dietrich also said there is precedent for listing companies that deal with a connection to the cannabis industry.
“The Nasdaq has already listed at least 3 biotechnology companies that extract compounds from the cannabis plant for scientific research – actually touching the plant as part of their business model,” adding that alcohol and tobacco companies, too, cause far more social harm than cannabis companies, yet are consistently approved for listing.
MassRoots has requested the denial in writing, and plans to appeal the staff decision to the Nasdaq Listing and Qualifications Board.
There’s also a report at CNN Money
Isaac Dietrich, a co-founder of MassRoots, said the decision sets a “dangerous precedent” that will prevent other legal marijuana companies from getting listed on national stock exchanges.
“This [will make] it more difficult for cannabis entrepreneurs to raise capital and slow the progression of cannabis legalization in the United States,” Dietrich.
Nasdaq said it does not comment on listing application decisions.
And Forbes too
MassRoots, a social platform for cannabis users, has been rebuffed in its attempt to list its stock on the NASDAQ exchange.
MassRoots received word on Monday that its application had been denied by the exchange on the grounds that MassRoots may be deemed to be aiding and abetting the distribution of an illegal substance.
“With this decision, the NASDAQ has set a dangerous precedent that will prevent nearly every company in the regulated cannabis industry from listing on a national exchange. This will have ripple effects across the entire industry, making it more difficult for cannabis entrepreneurs to raise capital and slow the progression of cannabis legalization in the United States,” stated MassRoots CEO Isaac Dietrich. “This decision must not be allowed to stand and we’re asking every cannabis investor, business, activist and supporter to write a brief note to the Nasdaq in support of our appeal here.”
MassRoots said it has requested the denial letter from NASDAQ in writing and will file an 8-K within four days of the receipt. They plan to appeal the decision to the Nasdaq Listing and Hearings Review Panel. If NASDAQ denies the appeal, MassRoots will appeal to the Securities and Exchange Commission (SEC).
“If we were a social network for tobacco users or alcohol consumers, the NASDAQ would likely be moving forward on our application even though alcohol and tobacco cause far more deaths and societal damage than cannabis ever will. Moreover, the NASDAQ has already listed at least 4 biotechnology companies that extract compounds from the cannabis plant for scientific research – actually touching the plant as part of their business model,” continued Dietrich. “We believe the Nasdaq has inappropriately denied our application and look forward to making our case not just to the Nasdaq Listing and Hearings Review Panel, but directly to the American public.”
You can see at Market Watch that the news has hit the company’s capitalization
Estimated 52 week high was $2.34 it dropped to .54 on the news and has made a slight recovery as of 25 May to .74