New York Regulators Reach Settlement 'In Principle' over CAURD Lawsuit

The lawsuit resulted in a hold placed on hundreds of licensed operators in the state.

New York marijuana regulators and a quartet of service-disabled veterans who filed suit in August over the cannabis licensing system have reached a settlement deal “in principle” that may allow hundreds of licensed retailers to move forward with their business ventures, according to a letter filed with a state appeals court on Monday.

Attorney Brian Burns submitted the letter to the appellate division of the New York Supreme Court on behalf of the four plaintiffs, stating that the parties in the case have “reached an agreement in principle” that could result in the suit being dismissed.

“Finalization of any settlement is contingent on the drafting and execution of a formal settlement agreement acceptable to all parties,” along with approval by the New York Cannabis Control Board (CCB), Burns wrote.

If a settlement has been reached, it could a preliminary injunction that has stalled more than 400 conditional adult use retail dispensary (CAURD) licenseholders from opening their shops could be lifted.

Judge Kevin Bryant of the New York Supreme Court issued the injunction after ruling that there was a good chance that regulators exceeded their authority by creating the CAURD program, which was reserved for “justice-involved” individuals who had nonviolent cannabis criminal records. The program was closed to all other entrepreneurs, which led to controversy and complaints from various quarters, as well as legal action.

Though New York’s CCB and Office of Cannabis Management had approved 463 CAURD licenses prior to the lawsuit, only 27 have thus far opened for business, an OCM spokesperson confirmed Wednesday. A 28th legal shop also opened Wednesday on Long Island, run by the Shinnecock Indian Nation.

Bryant allowed a handful of CAURD licensees to proceed with openings while the court order remained in place, but that left hundreds more uncertain as to whether they’d be allowed to eventually open or not.

Regulators even advised CAURD license winners to reapply during the current universal business licensing window, which is open to the public until Dec. 18, because they weren’t certain what the outcome of the litigation would be for the entire CAURD program.

One of the CAURD winners, Bronx resident Roger Thomas, told the New York Daily News that he’s hoping the settlement is real and that it’ll allow him to get his shop open quickly, because he’s expecting even more litigation, which could cause further delays.

“Something else might come up,” Thomas said. “So we figure we need to get open ASAP. That’s the only way we’ll get through the lawsuits.”

John Schroyer

John Schroyer has been a reporter since 2006, initially with a focus on politics, and covered the 2012 Colorado campaign to legalize marijuana. He has written about the cannabis industry specifically since 2014, after being on hand for the first-ever legal cannabis sales on New Year’s Day that year in Denver. John has covered subsequent marijuana market launches in California and Illinois, has written about every aspect of the marijuana trade, and was part of the team that built the cannabis industry’s first-ever trade show, MJBizCon. He joined Green Market Report in 2022.

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