Maine Cannabis Coalition Files Suit Over Removed Industry Residency Requirements

The Maine Cannabis Coalition is suing the state over its recent decision to remove residency requirements for cannabis licensees.

Full story after the jump.

The Maine Cannabis Coalition has filed a lawsuit against the state for its decision to remove residency requirements for cannabis business licenses, the Portland Press Herald reports. The trade association says the decision by the state Department of Administrative and Financial Services violates Maine’s Marijuana Legalization Act.

The decision by the agency was in response to another lawsuit by Wellness Connection of Maine over the residency requirement. The Wellness Connection and Wellness and Pain Management Connection of Delaware, which are financially tied to international cannabis firm Acreage Holdings, filed the lawsuit against the state in April arguing that the residency requirement violated the commerce clause of the U.S. Constitution which forbids restrictive and discriminatory commercial regulations between the states.

The Office of Marijuana Policy, which is housed in the Administrative and Financial Services division, said it wouldn’t enforce the policy after the state Attorney General’s Office said the state was unlikely to beat the lawsuit in court because the state Supreme Court had struck down residency requirements in the past.

“Maine Cannabis Coalition and its members along with many other citizens fought hard for two years to make sure residency protections were included in the law. To have it all be ignored after all the hard work and efforts is extremely aggravating to the citizens and policy makers of Maine who expect no one to be above the law.” – MCC in a statement via the Press Herald

In the lawsuit, Maine Cannabis Coalition claims the decision to revoke the requirement hurts medical cannabis providers such as MCC co-founder Dawson Julia, a caregiver, and Christian Roney, who is seeking a recreational cannabis license, by increasing the number of entities competing for limited market share. Both Julia and Roney claim they relied on the competitive advantages provided by the residency requirement while developing their business plans.

As passed, the Maine law requires every officer, director, and manager of recreational cannabusinesses, and most of its ownership, to have lived and filed taxes in Maine for at least four years. That rule would have expired in June 2021.

The plaintiffs argue that the OMP doesn’t have the authority to abandon parts of the law that have not been struck down by a court or repealed by the Legislature and seeks an injunction preventing officials from awarding any licenses to out-of-state applicants, the report says.

The long-awaited rollout of the state’s adult-use cannabis industry was put on hold amid the state’s coronavirus response. OMP Director Erik Gunderson told the Press Herald that the decision to strike down the residency requirements would not further delay sales.

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