The Commonwealth Dispensary Association has withdrawn a lawsuit against the state Cannabis Control Commission on Monday, citing that it is in the “best interest of the industry and our members.”
In the lawsuit, which was filed earlier this month, the CDA argued that new delivery regulations from the CCC that allow for a marijuana operator license violate the commission’s statute. Cannabis delivery licenses are limited to social equity and economic empowerment applicants for the first three years.
Some delivery applicants saw the suit as an “attack on equity.”
The decision came after cannabis dispensaries started to drop membership to the CDA in the last few days, citing support of equity in the industry. In Good Health in Brockton and Cultivate, which has locations in Leicester and Framingham, announced they were ending membership with the CDA on Saturday.
Another store pulled its membership on Sunday. Northeast Alternatives (NEA) in Fall River announced that the withdrawal of membership was a direct result of the lawsuit.
“We believe that to enable a fair and equitable cannabis industry we must stand up for what we believe in,” read a statement from the NEA’s spokesperson. “Given the recent lawsuit by the Commonwealth Dispensary Association, we have decided to resign in order to stay true to our NEA values.”
Meanwhile, there had been calls to boycott dispensaries that were members of the CDA.
The operator license allows for the wholesale purchase of cannabis to be warehoused and then sold and delivered. There’s also a courier license, which allows equity applicants to partner with retailers to deliver directly to consumers. Couriers can charge fees but cannot sell, process, store or repackage goods.
The CDA argued that there are no limits on how many vehicles a wholesale delivery licensee can operate, which leads to the possibility of an “Amazon” scale operation that would undermine brick and mortar retail store[s] and small delivery operators.
“There are questions that need to be answered, not only about how CDA members voted as to this lawsuit originally but also if they will attempt to revive its core objectives (banning the equity priority period and the equity delivery operator license entirely) through different means,” wrote Grant Smith Ellis, president of the Massachusetts Cannabis Reform Coalition (MASSCANN) in a statement. “The CDA has a history of anti-equity public policy positions.”
However, in a statement Monday, the CDA stated that the organization is committed to voicing “strong support for increasing Social Equity and Economic Empowerment participation through efforts that directly address the greatest barrier to entry” and plan to continue its advocacy work for “new opportunities and programs that can make a difference.”
The lawsuit also argued that the regulations should not have been declared because the law requires three lawfully seated commissioners and noted that Shaleen Title’s term had ended and a new commissioner had not yet been appointed.
“The CDA has determined it is in the best interest of the industry and our members to drop the lawsuit against the Cannabis Control Commission,” read the statement from the CDA on Monday. “We all need to be working together on achieving our many shared objectives, including increasing the participation of a diverse set of entrepreneurs in the industry.”