Harborside to Combine with Urbn Leaf and Loudpack to Create StateHouse Holdings

Harborside Inc. (CSE: HBOR), (OTCQX: HBORF) a California-focused, vertically integrated cannabis enterprise, is pleased to announce that it has entered into definitive agreements to acquire UL Holdings Inc. (“Urbn Leaf”),  a top California cannabis retailer with a dominant position in Southern California  and  LPF JV Corporation (“Loudpack”), a leading manufacturer, cultivator and distributor of award-winning cannabis brands in California . Following completion of the Transactions, Harborside is expected to be renamed StateHouse Holdings  (“StateHouse”), subject to shareholder and regulatory approval.

Duane Morris partner Nanette Heide, who led the team that acted as United States legal counsel to Harborside, commented, “We are super proud of Harborside for taking on the challenge of pursuing two opportunities almost simultaneously and delighted to be the legal team that led them through this intense process.”

To learn more about the transaction, please visit the New Cannabis Ventures website.

New York DOL Publishes Guidance on Recreational Use of Cannabis Related to the Workplace

By Katelynn Gray

As we previously reported earlier this year, Governor Cuomo signed the Marijuana Regulation and Taxation Act (“MRTA”), which legalized adult-use and possession of cannabis, effective March 31, 2021. The MRTA amended Section 201-D of the New York Labor Law (“NYLL”) making it illegal for employers to discriminate against someone for their use of cannabis outside the workplace, outside of work hours and while not using their employer’s equipment or property.

This spurred some obvious questions from employers- Can we take action against an employee for using cannabis while working? Can an employee use cannabis while on breaks? What about employee use of cannabis if they are not at work on premises but are on call? The New York Department of Labor has now published FAQs addressing these, and other, common employer questions.

Continue reading “New York DOL Publishes Guidance on Recreational Use of Cannabis Related to the Workplace”

New York Cannabis Chief Reiterates Social Equity Focus in Speech at Cannabis Trade Show

Tremaine Wright delivered her first public speech since being appointed Chair of the New York State Cannabis Control Board at the CWCBExpo (Cannabis World Congress & Business Exposition) at the Javits Center on November 4.  Wright leads the five-member board charged with approving a regulatory framework for New York’s cannabis industry and will oversee licensing of cannabis businesses.  In her remarks before 400 people at the business-to-business cannabis industry trade show, Wright reiterated that New York will support social equity licenses for people from communities historically affected by the War on Drugs.  “We’re about to create the most equitable cannabis program in the country,” she said.  Wright also said that New York will prevent social equity licenses from being sold to large companies by requiring that they be sold to other social equity licensees.  However, the regulations are currently being written and there are few details about how the state will help social equity applicants raise capital to start cannabis businesses.  Wright also said that all license applicants will be required to share their ESG (Environmental, Social, and Corporate Governance) frameworks to operate in the state.  The Board has a goal of issuing licenses within 18 months.  Members of New York’s Office of Cannabis Management were also in attendance at the Expo.

Report of Office of Cannabis Management Board Meeting, November 3, 2021

By Jerome T.  Levy

The meeting was called to order at 1:00 p.m. by the Chairperson, Tremaine Wright, noting that all parties were present and Ms. Garcia was attending via remote contact. Ms. Wright stated that the meeting was being recorded and will be available on the Cannabis Control Board website. Ms. Wright indicated that the agenda would include opening remarks, approval of the minutes of the previous meeting and then a report by the Executive Director of the Office of Cannabis Management, Chris Alexander. She reminded the audience and the Board members that the law was passed March 31, 2021 and as a result, while some aspects were moving swiftly, much of the work being done was still preliminary. The work has been mostly staffing, hiring new employees and moving staff from other New York State departments, principally the Department of Health. Continue reading “Report of Office of Cannabis Management Board Meeting, November 3, 2021”

Tremaine Wright presents to the NYSSCPA Cannabis Committee

By Hugh Jacobsen

Tremaine Wright, the Chairwoman of the Cannabis Control Board of the New York Office of Cannabis Management (OCM), on October 28, 2021 gave a presentation to the Cannabis Committee of the New York State Society of Certified Public Accountants on various items relating to cannabis regulation in New York.

At this presentation, Ms. Wright went over various features of the Marijuana Regulation and Tax Act.  She noted that there will be preference to individuals and communities injured by the War on Drugs and reiterated the goal of the legislation to ensure that at least 50% of the licenses go to social equity applicants.  She noted that there are nine different types of licenses provided in the statute and that vertical integration will generally be prohibited.  However, New York will take steps so that micro businesses will not have to raise as much  capital that would be required by other entities. In addition, there is no consideration currently being given to a residency requirement for obtaining a license. In response to a question on capital requirement, she did note that she had heard that people were spending over a $1 million to open up a retail dispensary, and she thought it could be done for less.   She also encouraged the industry to provide more education so that people do not enter into significant financial commitments (such as rent) earlier than necessary. Continue reading “Tremaine Wright presents to the NYSSCPA Cannabis Committee”

NYS Cannabis Control Board Meeting Summary 10/21/21

The New York State (“NYS”) Cannabis Control Board (the “Board”) held its second public meeting earlier today, just 16 days after its inaugural meeting on October 5th.  The meeting was livestreamed to the general public with all Board Members (Tremaine Wright (Chair), Jessica Garcia, Jen Metzger, Rueben McDaniel and Adam Perry (attending virtually)), the Executive Director (Chris Alexander) and Chief Equity Officer (Jason Starr) in attendance.

Chairwoman Wright summarized the Board’s work since its last meeting including (1) its ongoing employment efforts (both new hires and the transition of existing NYS Department of Health staff), (2) the Board’s outreach to key NYS stakeholders (including visits to various cultivation and processing facilities), and (3) continued work on the creation of implementing regulations as required by the NYS Marijuana Regulation and Taxation Act (the “MRTA”).

Executive Director Alexander introduced the key features of newly proposed Medical Cannabis Home Cultivation Regulations.  The Board approved the submission of these draft regulations to the Office of Cannabis Management (the “OCM”) for publication on the OCM website, upon which a four month public review and comment period will commence.  In a nutshell, these new regulations will permit home cultivation (indoor or outdoor) of a limited number of cannabis plants (six in total, with some exceptions) by certified patients and their designated caregivers for personal medical use.  These regulations are not intended to permit home cultivation for adult recreational use.

Executive Director Alexander also presented an update on the Expungement and Criminal Justice efforts undertaken by NYS in accordance with the requirements of the MRTA.  Those efforts, to eradicate criminal records related to marijuana usage, are ongoing and must be completed by March 31, 2023.

Finally, the Executive Director summarized the Municipal Opt-Out Program under which municipalities may opt-out of (prohibit) adult-use dispensaries and/or on-site consumption licenses from operating within their jurisdiction (however, they cannot opt-out out of other license types or adult-use legalization itself).  Local laws “opting-out” must be passed by December 31, 2021.  Municipalities that opt-out may opt-back-in at any time.  Municipalities that opt-out will not receive any revenue from the local excise tax on the sale of adult-use products.

The Board has not yet scheduled its next public meeting but the time and livestream link for that meeting will be posted on the OCM website in advance of the meeting.  Chairwoman Wright suggested the public sign-up to receive updates from the OCM, which will include notices of all future Board meetings.  The sign-up page for the OCM can be found here:  https://cannabis.ny.gov/sign_up_for_updates_from_OCM

Summary drafted by Michael Schwamm, Jerome Levy, Michael Barz and Erensu Altan.

Notes from New York Cannabis Control Board Meeting, October 2021

By Michael D. Schwamm and Joy Karugu

There were several outcomes of the inaugural New York Cannabis Control Board (CCB) Meeting held on October 5, 2021. The Meeting revealed that the CCB and the Office of Cannabis Management (OCM) will be increasing their staff and taking steps to extend the medical cannabis program and cannabinoid hemp licensing. Also during the Meeting, Jason Starr was announced and voted in as the Chief Equity Officer of the OCM. He will work with Executive Director Chris Alexander in building New York’s social equity program. Continue reading “Notes from New York Cannabis Control Board Meeting, October 2021”

Michael Schwamm to Be Panelist at Arcview Town Hall: Massachusetts

Duane Morris partner Michael Schwamm will be a panelist at Arcview’s virtual event, Town Hall: Massachusetts, on October 14, 2021, at 1:00 p.m. PT/4:00 p.m. ET.

Massachusetts’ cannabis industry has surpassed $2B in sales, has issued 900+ licenses, and employed more than 16K people in less than three years. Find out what’s behind Massachusetts’s success and what comes next for the commonwealth’s cannabis industry.

For more information, please visit the event website.

New York’s Cannabis Industry May Finally Get Rolling

The New York State Senate late Wednesday confirmed Governor Hochul’s appointments to lead the agencies that will regulate cannabis sales in New York, giving a major boost to the legalization process that had stalled under former Governor Cuomo.

Tremaine Wright was confirmed as chairperson of the Cannabis Control Board and Christopher Alexander was confirmed as the executive director of the new Office of Cannabis Management, which were formed as part of a bill that legalized recreational use of marijuana in New York this spring.

Continue reading “New York’s Cannabis Industry May Finally Get Rolling”

Duane Morris Cannabis Industry Group Ranked in The Legal 500

Duane Morris’ Cannabis Industry Group has been ranked in The Legal 500 US 2021 guide.

An excerpt from the publication:

Acting for central and ancillary cannabis industry clients, Duane Morris LLP stands out for its broad practice in the area, with regular activity in matters ranging from financings, M&A and joint ventures, to litigation, tax and regulatory issues. Publicly-traded companies, private funds, family offices and high-net worth individuals are among the team’s core clients.

Additional Key Attorneys Named: Nanette C. HeideMichael D. Schwamm; David E. Landau

Testimonials

        • “My key contact is Michael Schwamm. His team is excellent and very knowledgeable regarding cannabis matters.”
        • “Michael Schwamm is a leader in the group and provides excellent and prompt advice.”

For more information, please visit the firm website.

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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