The federal court in August ruled New York’s argument, that the U.S. Constitution did not apply to New York’s state cannabis licensing program, was flawed.
The U.S. Court of Appeals, Second Circuit ruled the New York Cannabis Control Board (CCB)’s licensing procedures for adult-use marijuana dispensaries were in violation of the dormant Commerce Clause By providing an incentive to applicants who have cannabis related offenses.
The dormant Commerce Clause in the U.S. Constitution prohibits states from taking protectionist steps to maintain a national marketplace for goods and service.
However, many state cannabis programs have evaded constitutional attack while prioritizing in-state applicants for licensure because interstate commerce is outlawed under cannabis’s Schedule I federal status—meaning there is no national cannabis marketplace to protect from state economic isolationism.
New York officials claim that the CCB-imposed residency requirement to obtain preferred licensure is not in violation of the Commerce Clause. This was because, following the legalization of adult use, the purpose for the board afterward was to grant licenses as a form restorative justice and not economic protectionism to those business owners who had been affected by the drug war.
Further, it argued that cannabis was illegal at the federal level and therefore, two license applicants who had ties with California did not have standing to challenge California law.
The plaintiffs/appellants in the case, Variscite NY Four LLC and Variscite NY Five LLC, submitted adult-use dispensary license applications for the CCB’s December 2023 licensing pool. The majority of Variscite’s owners lived in Los Angeles communities that were “disproportionately affected by cannabis prohibition”, but they had no cannabis convictions and did not meet New York’s requirements to be licensed.
Variscite sought a preliminary and temporary injunction in December of 2023. However, the U.S. District Court of New York Northern District denied the motion. denied Variscite is to receive preliminary relief in February 2024. This ruling will rule that the Commerce Clause, which has been dormant for many years, does not cover markets that Congress criminalized.
Variscite appealed and the Second Circuit, in a ruling of 2-1, vacated district court’s judgment on the 12th August.
Then there was [an] “Court Judge Dennis Jacobs” Writer The majority opinion on the ruling of the District Court was released Tuesday.
“We hold that Plaintiffs-Appellants have standing to challenge certain of New York’s licensing practices under the dormant Commerce Clause, and that their suit is ripe; that the dormant Commerce Clause applies and Congress has given New York no clear permission to enforce protectionist marijuana licensing laws; and that New York’s prioritization of applicants with convictions under New York law is a protectionist measure that cannot stand,” Jacobs wrote.
Second Circuit opinion states that New York’s CAURD (conditional adult-use retailer dispensary) licenses issued in 2022 to companies owned by people involved with the criminal justice system are unconstitutional.
New York regulators of cannabis issued a specific statement. 291 CAURD licenses.
Jeffrey Jensen, a California and New York lawyer who founded the Variscite companies that have sued New York’s cannabis regulators multiple times, was not surprised by the Second Circuit ruling in Variscite’s favor.
Jensen said that the Second Circuit “reached the conclusion required by the Constitution.” Cannabis Business Times. The dormant Commerce Clause, which is a separate clause from the Commerce Clause of the Constitution, prevents a state from giving economic benefits to its residents.
Second Circuit Court of Appeals’ ruling is consistent with that made by the First Circuit Court ruling The ruling was dated August 20, 2022 and upheld an earlier Maine judge’s decision that the requirement of residency for those who own medical marijuana businesses in Maine is unconstitutional.
Matthew S. Warner, a partner at law firm Preti Flaherty Beliveau & Pachios LLP who represented the plaintiffs in Maine, told CBT At the time, the First Circuit ruling confirmed that “the U.S. Constitution is applicable to marijuana like any other industry.” … To have constitutional protections in place that every other industry has will be good for the industry in the long run, and it should certainly influence the way policymakers start doing their jobs, now.”
In addition to the First and Second Circuit rulings that are now finalized, there are three active appeals—one in the Fourth Circuit and two in the Ninth Circuit—that also relate to the dormant Commerce Clause’s application to state cannabis license preferences.
Jensen has been involved in appeals both for the Ninth Circuit and the Fourth Circuit, though different clients.
If there is a circuit split in the future, losing parties can seek redress before the U.S. Supreme Court.
RELATED: A Retrospective Gonzalez Faced with a Potential Circuit Divide
Jacobs, in his ruling of Tuesday on the Second Circuit, wrote that “a ban intended to eliminate an interstate marketplace is not a licence for states to incubator Intra-Antagonistic CommunicationState markets of the same product.
Judge explained that, while interstate bans can result in complementary state bans as well, New York had not prohibited interstate traffic of cannabis but instead provided preferential licensing to those who were convicted for cannabis offenses within New York.
Jacobs wrote that to give priority to state-level protectionist legislation Congress needs more than simply disapproving of interstate markets: it must also approve the protectionism itself.
Judge wrote: “Congress has not explicitly authorized federal prosecutions for marijuana manufacturing, distribution or possession.” Congress did not give New York the right to prefer its citizens over those who operate in a way that skirts federal drug laws.
The federal court in August ruled New York’s argument, that the U.S. Constitution did not apply to New York’s state cannabis licensing program, was unsound.
The U.S. Court of Appeals, Second Circuit ruled the New York Cannabis Control Board (CCB)’s licensing procedures for adult-use marijuana dispensaries were in violation of the dormant Commerce Clause By providing an incentive to applicants who have cannabis related offenses.
The dormant Commerce Clause in the U.S. Constitution prohibits states from taking protectionist steps to maintain a national marketplace for goods and service.
However, many state cannabis programs have evaded constitutional attack while prioritizing in-state applicants for licensure because interstate commerce is outlawed under cannabis’s Schedule I federal status—meaning there is no national cannabis marketplace to protect from state economic isolationism.
State officials in New York argue that CCB’s requirement of residency for preferential licensure doesn’t violate the dormant Commerce Clause, because its purpose after adult use legalization was awarding licenses to businesses previously impacted as a measure to restore justice, and not economic protectionionism.
Further, it argued that cannabis was illegal at the federal level and therefore, two license applicants who had ties with California did not have standing to challenge California law.
The plaintiffs/appellants in the case, Variscite NY Four LLC and Variscite NY Five LLC, submitted adult-use dispensary license applications for the CCB’s December 2023 licensing pool. The majority of Variscite’s owners lived in Los Angeles communities that were “disproportionately affected by cannabis prohibition”, but they had no cannabis convictions and did not meet New York’s requirements to be licensed.
Variscite submitted a motion for a preliminarily injunction and temporary restraining in December 2023, but it was denied by the U.S. District Court of the Northern District of New York denied In February 2024, Variscite will receive preliminary relief ruling that the Commerce Clause is dormant and does not apply in markets criminalized by Congress.
Variscite appealed and the Second Circuit, in a ruling of 2-1, vacated district court’s judgment on the 12th August.
Then there was [an] “Court Judge Dennis Jacobs” Writer In the majority opinion of Tuesday, the District Court’s decision was affirmed.
“We hold that Plaintiffs-Appellants have standing to challenge certain of New York’s licensing practices under the dormant Commerce Clause, and that their suit is ripe; that the dormant Commerce Clause applies and Congress has given New York no clear permission to enforce protectionist marijuana licensing laws; and that New York’s prioritization of applicants with convictions under New York law is a protectionist measure that cannot stand,” Jacobs wrote.
Second Circuit opinion states that New York’s CAURD (conditional adult-use retailer dispensary) licenses issued in 2022 to companies owned by people involved with the criminal justice system are unconstitutional.
New York cannabis regulators have issued specific guidelines. 291 CAURD licenses.
Jeffrey Jensen, a California and New York lawyer who founded the Variscite companies that have sued New York’s cannabis regulators multiple times, was not surprised by the Second Circuit ruling in Variscite’s favor.
Jensen said that the Second Circuit “reached the conclusion required by the Constitution.” Cannabis Business Times. The dormant Commerce Clause, which is a separate clause from the Commerce Clause of the Constitution, prevents a state from giving economic benefits to its residents.
Second Circuit Court of Appeals’ ruling is consistent with that made by the First Circuit Court ruling The ruling was dated August 20, 2022 and upheld an earlier Maine judge’s decision that the requirement of residency for those who own medical marijuana businesses in Maine is unconstitutional.
Matthew S. Warner, a partner at law firm Preti Flaherty Beliveau & Pachios LLP who represented the plaintiffs in Maine, told CBT The First Circuit’s decision “confirmed that the U.S. Constitution applied to the marijuana business like it did to all other industries,” said the First Circuit at the time. … To have constitutional protections in place that every other industry has will be good for the industry in the long run, and it should certainly influence the way policymakers start doing their jobs, now.”
In addition to the First and Second Circuit rulings that are now finalized, there are three active appeals—one in the Fourth Circuit and two in the Ninth Circuit—that also relate to the dormant Commerce Clause’s application to state cannabis license preferences.
Jensen has been involved with appeals both in the Ninth Circuit and the Fourth Circuit, for clients that are different.
If there is a circuit split in the future, losing parties can seek justice before the U.S. Supreme Court.
RELATED : A Revisiting Gonzalez The Face of a Potential Circuit Divide
Jacobs, in his ruling of Tuesday on the Second Circuit, wrote that “a ban intended to eliminate an interstate marketplace is not a licence for states to incubator You can also find out more about the intranet.“State markets for the same product”
The judge stated that although interstate prohibitions may lead to state-by-state restrictions, New York does not ban interstate marijuana traffic. Instead, it provides preferential treatment to people who have been convicted of cannabis in New York.
Jacobs writes that “to give state protectionism the priority it deserves, Congress has to do more than just disapprove an interstate marketplace: It also must accept protectionism itself.”
The judge stated that “the only thing Congress clearly authorized in criminalizing marijuana was federal prosecution of the manufacture, the distribution and the possession of marijuana.” The judge wrote that Congress has not given New York permission to give preference to its residents who are able and willing do business in a way which does not violate federal laws.
Cannabis Law Resources in Poland
Browse essential legal pages on cannabis sales and cultivation in Poland. These guides will help you understand the legal requirements, such as certifications, permits, and compliance.
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Polish News Registration and Interests of Cannabis Businesses
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Permissions for Cannabis Sales in Poland
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Authorization for Importing or Manufacturing Medical Products
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Permission for Manufacturing or Importing Medical Products
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Certificate of Good Manufacturing Practices (GMP)
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Registration of Medical Products in Poland