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The Empire State is one step closer to selling recreational weed. New York doled out its first thirty-six cannabis retail licenses today, with twenty-eight going to individual businesses and eight to nonprofits serving those with histories of arrests or incarceration. Approved nonprofits include Housing Works, the Doe Fund, and LIFE Camp

But New York wasn’t expected to hand out just thirty-six licenses. The state had designated 150 dispensary licenses for the first round. Last week, a federal judge issued an injunction temporarily blocking licenses in the state, including Brooklyn and the Mid-Hudson area. 

Shortly after a POLITICO article highlighted the state’s flourishing gray market, Variscite NY One filed a federal lawsuit claiming that New York’s licensing selection favors in-state residents over out-of-staters. If true, this violates the state’s constitutional interstate commerce protections. 

Variscite NY One is based in Michigan. Its founder, Kenneth Gay, has a cannabis conviction which qualifies the company for social equity consideration. But since it’s not a New York conviction, he’s not eligible for the first round of licenses. The state has not said if it will appeal the decision. 

We’ll continue to closely watch New York as it rolls out the next steps toward retail.

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