NEW YORK’S PLAN TO SPEND TAXPAYER FUNDS ON MARIJUANA STORES CHALLENGED IN FEDERAL COURT
Media contact person is:
George F. Hritz, Esq.
On August 25, 2023, the Cannabis Impact Prevention Coalition and the Cannabis Industry Victims Seeking Justice, and individual plaintiffs, filed a lawsuit in the federal District Court for the Northern District of New York against Governor Kathy Hochul and the New York State Cannabis agencies and their officials. The pleadings are attached.
The lawsuit seeks a declaratory judgment and an injunction to stop the state from financing marijuana trafficking operations (marijuana stores) in violation of the federal Controlled Substances Act and the Food and Drug Act and the New York Finance Law § 123.
After the Legislature enacted marijuana legalization, Governor Hochul proposed, and the Legislature enacted, the “Social Equity Cannabis Investment Fund.” The Fund is a public-private partnership to provide start-up financial support for cannabis “dispensary” licensees for those individuals who had prior marijuana convictions and their families. The $200,000,000 Fund is seeded with $50,000,000 in State funds, expecting to be repaid from tax revenue generated by cannabis sales (proceeds of marijuana trafficking), and $150 million in private investment.
“In an Orwellian change of terms, formerly convicted drug criminals are now referred to by the state as “social equity entrepreneurs” and marijuana trafficking operations are now “dispensaries” stated plaintiffs’ attorney George Hritz.
The Dormitory Authority of the State of New York ("DASNY") is New York State's public finance and construction authority that normally finances, and builds health and education infrastructure. Ironically, DASNY would instead become the biggest marijuana trafficking landlord in New York. DASNY would lease properties and be responsible for collecting rent from marijuana trafficking operations and paying these illegal monies to the primary landlord. However, it is unlawful to knowingly open, lease, rent, maintain, or use property for the manufacturing, storing, or distribution of controlled substances such as marijuana.
Marijuana is not a “states' rights” issue under the U.S. Constitution. The Defendants have violated federal law by improperly assuming the roles of the U.S. Congress and the federal Drug Enforcement Administration (DEA) and the Food and Drug Administration (FDA). Defendants seek to impose their own policies and judgment over those of Congress and the federal agencies that are far better experienced and qualified, and are designated by federal law, to exercise such judgments and create such policies. Defendants' arbitrary and capricious foray into financing marijuana trafficking will harm our national controlled substances consumer protections including the food and drug protections of the Food and Drug Administration.
The actions of the state in promoting marijuana trafficking do not protect the public's health, safety, and welfare. One example of how far the Defendants have gone in failing to protect the health and safety of New York's children is the state cannabis agency 2023 Mother's Day “Twitter” greeting.
NYS Office of Cannabis Management
May 12 Mothers across the nation have faced shame for their cannabis consumption, but anyone who knows a mom, knows, it takes more than grace to get through the day. This #MothersDay we want to end the stigma & share some insight. Tell us, how #NYcannabis has helped you in motherhood?
The State of New York is advocating the use of today’s high potency marijuana to "help" mothers "get through the day.” Mothers are responsible for the care of their children, many children are helpless infants.
“Mothers who are impaired cannot responsibly take of their children. This Mother's Day greeting is grossly irresponsible and utterly shameful having been issued by a government agency. It shows reckless obsession with promoting marijuana for supposed financial gain.” stated plaintiff Renee' Barchitta, MPA.
There are far better projects to spend taxpayers’ money on than promoting marijuana use for mothers taking care of infants.
"Plaintiffs are concerned about their quality of life and property rights. The state financed marijuana stores and related businesses will cause a diminution in their property values and rights and quality of life by having de facto criminal enterprises in their communities,” stated Hritz.
Today’s marijuana is capable of wreaking havoc on the health, safety, economic strength and cognitive function of New York's citizens. Yet, for no other federally illegal drug is the gap so large between current scientific evidence of adverse consequences and the public perception. Investment by the State of New York in promoting marijuana trafficking will only make this worse. The state’s Mothers’s Day greeting shows its blindness to the consequences of what it is doing.
In states that have (illegally) "legalized" marijuana, the marijuana industry is following the playbook of the tobacco and opiate industries in trying to get our kids addicted to ensure a new generation of customers.
In 2020, the New York Medical Society and the State Medical Societies of New Jersey, Ohio, Pennsylvania, and Delaware issued a joint statement stating their opposition to legalization of marijuana citing many concerning factors including data showing that despite best efforts of states to limit the purchase of legal marijuana to adults, it has also led to a troubling increase in youth use. This warning was ignored by the Defendants.
Marijuana “legal” states have higher rates of marijuana-related driving fatalities, greater emergency room visits, hospitalizations, and exposures, expansive criminal markets, as well as exacerbated racial disparities in industry participation and criminal justice enforcement.
“There are many small business start-ups that would like to get their costs paid for by the government. Why should the state spend $200,000,000 on one industry that sells a harmful and addictive substance? This is an unfair use of public funds” stated Hritz.
“The financing of marijuana trafficking is illegal whether it is done privately or by the government. This lawsuit is the first shot to stop it nationally. We are in the process of filing other lawsuits in other states to stop such financing,” stated David G. Evans Senior Counsel to Cannabis Industry Victims Educating Litigators whose organization supports the lawsuit.