Four Detroit medical cannabis dispensaries submitted a request last Thursday for a Wayne County Circuit Court judge to immediately void the city’s adult use cannabis license system on the grounds that state law expressly forbids elements of the city’s new license rules, enacted in April.
The motion for a summary judgment, filed by four medical dispensaries in Detroit, House of Dank, Herbal Wellness, TJM Enterprises Services, and Detroit Natural Selections Enterprises (operator of Green Genie), claims the ordinance will completely force them out of business by preventing them from applying for recreational licenses for the next five years.
[Read Haus of Dank brief for summary disposition.]
This is Detroit’s second attempt at creating an adult use licensing process. The first Detroit ordinance was struck down by a federal judge last year, who ruled that the law provided unfair preference to Detroit residents and called the ordinance more “protectionist than equitable.”
The new system does not allow existing medical dispensaries in Detroit, there are more than two dozen, to obtain an adult use license until January 1, 2027. Medical dispensary sales have been steadily declining over the last two years, and Detroit store owners have openly worried that without adult use licenses, they will be forced out of business.
In addition to their request for an immediate ruling on the case, the four dispensaries are seeking a temporary halt to all adult use business operations in Detroit until the judge issues a ruling.
In the motion, the dispensaries claim that city leaders are motivated by their concerns that too many existing medical stores are owned by “outsiders”, residents who have not lived in the city for more than five years, despite providing jobs and revenue to Detroit over the years.
“The City once again sees an opportunity to undercut these “outsiders” in favor of its preferred candidates by prohibiting existing medical marijuana provisioning centers from even applying to sell adult use at their current locations for almost 5 years,” the motion alleges. “As the city knows the scheme will virtually guarantee the imminent demise of these facilities.”
The new ordinance, which went into effect April 20, was drafted to help ensure long term Detroiters – particularly Black residents and those disproportionately affected by the War on Drugs – to get a leg up on starting their own cannabis businesses.
The new ordinance does not explicitly prohibit businesses from applying for recreational licenses in Detroit outright, but the plaintiffs believe that it would be virtually impossible to remain a viable business without a recreational license in city limits.
“The City’s medical marijuana stores are already on the brink,” the suit claims. “The City’s flagrant violation of MRTMA (Michigan Regulation and Taxation of Marihuana Act) threatens to entirely wipe them out.”
Attorney and cannabis lobbyist Eric Foster thinks that the city is fighting a losing battle but still believes that things can be resolved by reconstructing the licensing process to help both medical and recreational license holders.
“Detroit did not move in the right way,” Foster said. “They will more than likely stop the ordinance based on the Lowe [federal] lawsuit [resolved last year]. This is just not good.”
This is one of two major lawsuits filed in Wayne County that seeks to eliminate Detroit’s law, as JARS Cannabis filed suit June 9 with a similar complaint. In JARS suit, the company claims that once adult use licenses are fully distributed, adult use businesses would outnumber medical facilities 6-1, creating a “death sentence” for medical provisioning centers.
