Less than a month after a lawsuit challenged Detroit’s revised recreational marijuana ordinance, another lawsuit against the city was filed Friday, arguing the measure violates state law.
JARS Cannabis — a marijuana company that has two medical dispensaries in Detroit, among other medical and recreational dispensaries across Michigan — is asking the court to stop the City of Detroit from moving forward with its ordinance, which was passed in April.
“Detroit has created a schematic to give preferential treatment to its
residents, violate MRTMA (the state’s legal and regulatory framework for legally growing and selling recreational marijuana) and eradicate existing operators,” the lawsuit, which was filed in Wayne County Circuit Court, says.
This is the second lawsuit challenging Detroit’s second attempt at a recreational marijuana ordinance, and could be yet another setback in getting the recreational cannabis industry off the ground in the city.
John Roach, a spokesperson for the city, declined to comment.
Sales of recreational cannabis in Michigan began in December 2019, but Detroit officials didn’t introduce an ordinance to allow recreational marijuana sales within city limits until October 2020. That ordinance prioritized longtime Detroiters for licenses but a federal judge called the ordinance “likely unconstitutional” after it was challenged in a lawsuit.
In February, eight months after the judge’s opinion, Council President Pro-tempore James Tate introduced a revised ordinance that sets aside half of the 100 retail licenses for so-called equity applicants, which include longtime Detroiters and people from communities that have been disproportionately affected by marijuana prohibition and enforcement.
The city started processing applications for unrestricted licenses — such as for growing or processing cannabis — on April 20. But city officials are still working on setting up a system to start processing applications for the limited licenses.
In the lawsuit, JARS Cannabis argues that the ordinance violates state law in several ways. First, JARS says that Detroit’s scoring system for selecting which applicants receive a limited license fails to provide a competitive application process.
It awards points to applicants that are unrelated to their ability to operate in compliance with state law, the lawsuit said, such as giving points for committing to a “Good Neighbor Plan,” which includes hiring Detroit residents and donating to a Detroit charitable organization.
The lawsuit also points to a line in state law that says: “A municipality may adopt other ordinances that are not unreasonably impracticable and do not conflict with this act or with any rule promulgated pursuant to this act.”
JARS Cannabis argues it’s “unreasonably impracticable” because the scoring method deters them and others from applying, it prohibits the issuance of more than one recreational license to any direct or indirect owner and it effectively bans the co-location of medical and recreational cannabis facilities.
“It is abundantly clear that Detroit’s second ordinance serves as the kiss of death for existing medical-marijuana facilities operating within the city of Detroit,” the lawsuit says.
Scott Roberts, whose law firm Scott Roberts Law is representing JARS Cannabis in the lawsuit, puts it this way: “We believe the city council’s latest attempt at an ordinance clearly violates state law, which hurts not just Detroit dispensary owners and investors, but also the employees that rely on these businesses to provide for their families.”
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The first lawsuit — filed by the cannabis company House of Dank, which has several medical marijuana dispensaries in Detroit — asked a judge to allow existing medical dispensaries to also receive recreational licenses. If the city follows the current ordinance, medical facilities would not be given a shot at getting a recreational license until 2027, House of Dank argued. A status conference on that lawsuit is scheduled for Aug. 10.
Contact Adrienne Roberts: amroberts@freepress.com.
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