New Jersey’s Legal Cannabis Framework Creates Economic Opportunity with an Eye to Social Justice

On February 22, 2021, Governor Murphy signed into law The New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act, regulating cannabis use and possession for adults 21 years and older. The ratification of the bill follows a protracted legislative logjam since Election Day, when New Jersey voters overwhelmingly approved a mandate to provide the infrastructure for the legalization of cannabis in the state. The legalization immediately decriminalizes certain amounts of marijuana and hashish statewide. Meanwhile, the recreational production and sale remains subject to regulatory schemes not yet enacted.

Continue reading “New Jersey’s Legal Cannabis Framework Creates Economic Opportunity with an Eye to Social Justice”

Paul Josephson Named to List of People Shaping New Jersey’s Cannabis Industry

Paul Josephson, Duane Morris partner and team lead of the Cannabis Industry Group, has been named to the “CannaInfluencers” list of people shaping the cannabis industry in New Jersey.

NJ Cannabis Insider writes:

Paul Josephson remembers his time at the University of Michigan, a decade after the city of Ann Arbor had decriminalized marijuana.

“It was an issue everybody was aware of,” Josephson said. “You could walk past a cop with a joint hanging out of your mouth. You’d get a $15 summons you would have to pay.”

Not true for the Black students he encountered for the first time at a large university. He said he learned that their experiences with police officers was very different than his.

“If you were Black or poor, it could especially derail your career,” he said.

Combine that with Josephson’s history in politics, beginning with him being elected president of UM’s student government and then choosing to go to law school in the nation’s capital, and you can explain why he got involved in efforts to legalize marijuana in New Jersey.

To read Mr. Josephson’s full profile, please visit nj.com.

COVID-19 Forces Cannabis Industry and State Regulators to Evaluate and Improve Methods of Cannabis Delivery and Access

By Justin A. Santarosa, Arletta Bussiere, Joe Pangaro and Justin Stern

Cannabis operators, like all other businesses, are searching for new ways to reach their customers during the COVID-19 pandemic. Cannabis businesses have been generally treated as “essential” under the various state orders that have otherwise closed businesses and ordered people to stay at home. Even though they have been permitted to operate, it is not business-as-usual for these operators as they grapple with CDC workplace restrictions and guidelines for reducing the spread of COVID-19.

As a result of these restrictions, state regulators and cannabis business have begun implementing new policies and procedures such as curbside pick-up, expanded delivery zones and increased use of contactless payment methods. While these changes are viewed as temporary, if properly implemented, cannabis businesses may be able to show regulators that these expanded policies should continue after the crisis has passed. This difficult time presents an opportunity for cannabis retailers to expand their reach and help bolster support for more online ordering, home delivery and other delivery methods.

Below is a summary of how several states have handled the COVID-19 pandemic in relation to the operations of cannabis businesses during the stay at home orders. Continue reading “COVID-19 Forces Cannabis Industry and State Regulators to Evaluate and Improve Methods of Cannabis Delivery and Access”

Paul Josephson Named to Insider 100: Policymakers by Insider NJ

Paul Josephson
Paul Josephson

Duane Morris partner Paul Josephson was named to the 2019 “Insider 100: Policymakers” list by Insider NJ, which described him as “an expert on transportation and casino issues – and cannabis.” Mr. Josephson was also named to the 2017 and 2018 lists.

“The list assembles names listed … because of the rigorous quality of their public policy minds,” according to the publication.

To read the 2019 “Insider 100: Policymakers” publication, please visit the Insider NJ website.

On Your Mark, Get Set, Go: Revised New Jersey Medical MJ RFA Details Announced

It’s official: if you’re seeking a medical cannabis license in New Jersey, cancel your summer vacation plans. July and August promise to be very busy months. Today, the NJ Department of Health materially revised its current Request for Applications. Details below.

Although the number of permits to be issued this round has shrunken considerably, tomorrow, July 2, Governor Phil Murphy will be signing a major medical cannabis bill that substantially increases patient access, establishes a new regulatory overseer for the cannabis sector, and promises a much larger round of licensing (integrated and stand alone) this fall.

Key takeaways for the pending RFA round revised today:

  • Book It: Application forms will be released on July 15, 2019, and are due on August 21, 2019 at 3pm for dispensaries and August 22, 2019 at 3 pm for cultivation and integrated applications.
  • How Many? In total, the Department will seek up to 4 vertically integrated permits, up to 5 cultivation endorsements, and up to 15 dispensary endorsements.
  • In each of the three regions (North, Central, South) the Department will seek to issue up to 2 cultivation endorsements, 5 dispensary endorsements and 1 vertically integrated (cultivation, processing and dispensing) permits.
  • A fourth vertically integrated permit will be issued, with the region to be determined based on quality of application and patient need. “Because the patient population is expanding so quickly and is expected to accelerate, the Department anticipates that this flexible approach for up to 1 vertically integrated permit will allow for 1) the most qualified applicant to be chosen and 2) that the award can most adequately respond to real time changes in enrollment.”
  • No processing permits will be issued this round.
  • Initial Cultivation Canopy Limits: To provide opportunities for different sized businesses to participate in the RFA, the Department will seek to issue cultivation endorsements in the following tiers of canopy size:
    – Up to 5,000 Square Feet: up to 1 cultivation endorsement.
    – 5,001 square feet to 20,000 Square Feet: up to 2 cultivation endorsements.
    – 20,001 square feet to 30,000 Square Feet: up to 2 cultivation endorsements.
  • According to NJDOH, these cultivation tiers “represent the ranges of starting cultivation canopy at the ATCs awarded as part of this RFA. The maximum initial canopy for any of the awardees is 30,000 square feet. Vertically integrated applicants may choose any of the canopy tiers.”
  • Limits on Number and Combination of Applications:
    Entities and individuals may seek up to three total permit endorsements as part of this RFA. Applicants may only apply for one cultivation endorsement and may only submit one application per region. A separate application is required for each endorsement. An applicant for a vertically integrated permit may submit one application because all endorsements will be located within the same region. Therefore, the only applicants eligible to submit an application for more than one endorsement per region in this RFA are applicants for vertically integrated permits.
  • Applicants cannot submit for both vertically integrated permits and individual endorsements.
  • Applicants submitting for individual endorsements can submit applications for up to three endorsements, but they can’t be in the same region(s).
  • No applicant shall be awarded more than one permit pursuant to this RFA, and no applicant shall hold more than 1 cultivation endorsement, 1 manufacturing endorsement, and 1 dispensary endorsements as a result of the awards made pursuant to this RFA.
  • Except for the vertically integrated permits, no other entity shall be awarded both a cultivation endorsement and a dispensary endorsement pursuant to this RFA.
  • Current ATC permit holders (including awardees from December 2018) are not eligible to participate in this RFA.
  • Get Your Legal Documents Ready: NJDOH has substantially increased the disclosure requirements (of interested parties and documentation of virtually all business deals underlying an application) this round to ensure all parties interested in an application are known to the NJDOH at the time of application.
  • Questions, Comments and Further Information: NJDOH will accept questions on the RFA until July 26, and will conduct a preapplication webinar on August 2. Potential applicants are strongly encouraged to present any concerns, objections or suggestions relating to the substance of the RFA by July 26, if not sooner.
  • No Deadline for Award: NJDOH has not announced a deadline for making awards.
  • No License Squatting: Applicants awarded the right to complete the ATC permitting process must complete facility build out and be ready to commence operations within 18 months (cultivation endorsements and vertically integrated permits) or 12 months (dispensary endorsements). If an awardee is not permitted at the end of the above timeline, or the materials submitted with the application are found to be not accurate or truthful, as applicable, the award may be rescinded.
  • Criteria, Weighting and Page Limits:
    Applicants must observe a strict 100 page limit per endorsement sought. Criteria weighting is as follows:
    Criterion 1. Ability to meet the overall health needs of qualified patients and safety of the public. 30 pts
    • Measure 1, Security plan: 10 pts
    • Measure 2. Environmental impact plan: 10 pts
    • Measure 3, Quality control and quality assurance plan: 10 pts
    Criterion 2. History of compliance with regulations and policies governing government-regulated marijuana programs. 20 pts
    • Measure 1, Experience of principals, officers, and owners, in operating a regulated cannabis business, or operating a business in another highly regulated industry, such as healthcare, insurance, financial services, pharmaceuticals, or energy. 20 pts
    Criterion 3. Ability and experience of applicant in ensuring an adequate supply of marijuana. 20 pts.
    • Measure 1, Financing plan: 20 pts.
    Criterion 4. Community Support and Participation. 20 pts.
    • Measure 1, Ties to the local community: Applicants shall provide a list of all owners, officers, board members, and principals that have resided in NJ for at least 2 years, and supply proof of their residency. 20 pts.
    Criterion 5. Ability to provide appropriate research data. 10 pts
    • Measure 1, Research contributions: Evidence of past contributions – in the form of cited original and published work – to expanding clinical and scientific research related to medical cannabis or the debilitating medical conditions that can be treated with medical cannabis. 10 pts
    Criterion 6. Experience in cultivating, manufacturing, or dispensing marijuana in compliance with government-regulated marijuana programs. 100 pts.
    • Measure 1, Cultivation plan.
    • Measure 2, Manufacturing plan.
    • Measure 3, Dispensary plan.
    Criterion 7. Workforce and job creation plan, including plans to involve women, minorities and military veterans in ATC ownership, management and experience with collective bargaining in cannabis industries. 100 pts
    • Measure 1, Labor Peace Agreement: Applicants shall provide a signed labor peace agreement that includes provisions to ensure the cultivation, manufacturing and dispensing of medical cannabis will not be disrupted by labor-related disputes. Failure to provide a signed agreement will result in a score of 0 for this measure. 30 pts.
    • Measure 2, Labor compliance plan: Applicants shall provide a plan to comply with labor laws and an overview of their experience related to collective bargaining and/or accommodating the rights of workers. 20 pts
    • Measure 3, Minority-owned, women-owned or veteran owned business certification: Applicants shall provide a copy of certification(s) issued by the Department of the Treasury, Division of Revenue which verifies MBE/WBE certification or VOB certification, or evidence that the applicant would otherwise meet the MBE/WBE certification or VOB certification requirements once generating revenue. Applicants with a certification will receive the full 30 pts. Applicants that provide evidence of meeting the criteria in the future shall receive partial credit, based on the strength of the evidence. The selection committee shall take into account related entities for this measure. 30 pts.
    • Measure 4, Workforce and job-creation plan: Applicants will be scored on the extent to which they will involve individuals from socio-economically disadvantaged communities, individuals disproportionately impacted by enforcement of drug laws, and people with disabilities in the ownership, management and staffing of the proposed ATC. 20 pts
  • Scoring criteria reflect strong union (50 out of 300 total points), MBE/WBE (30 of 300 points) and social justice (20 of 300 points) preferences.

This post summarizes key terms of interest.  Potential applicants should review the complete terms of the RFA at https://www.nj.gov/health/medicalmarijuana/alt-treatment-centers/applications.shtml, and regularly consult the NJDOH website for ongoing updates.

NJ Assembly Delay Vote on Medical Cannabis Expansion – likely due to concern over potential Governor’s veto

NJ Assembly leaders announced they would not be voting on the proposed expansion of medical cannabis licenses earlier today – 6-10-19.

Instead, per NJ.com, legislators are going to attempt to work with Gov. Phil Murphy’s office on a plan that’s more amenable to him and the state Legislature, said Kevin McCardle, a spokesman for Assembly Democrats.

The Governor’s team has previously raised objections to a few provisions in the medical expansion bill, including the creation of the Cannabis Regulatory Commission, which would assume oversight of the industry. Currently, the state Department of Health regulates the medical marijuana program.

We will keep an eye out for any collaborative resolution of the medical licensure issue and report back.

#Duane Morris – Brad A. Molotsky, Esq.

New Jersey Medicinal Marijuana Program Set For Expansion

Just days after the NJ Senate and Assembly close in on expansion of medical use Cannabis, the New Jersey Department of Health (“Department”) published notice of a Request of Applications (“RFA”) for an additional 108 alternative treatment center (“ATC”) permits which authorize holders to cultivate, manufacture, and/or dispense medicinal marijuana. The Public Notice is available here, while the RFA is summarized below and available in full here.

Continue reading “New Jersey Medicinal Marijuana Program Set For Expansion”

NJ Senate and Assembly close in on expansion of medical use Cannabis – Brad A. Molotsky, Esq. – Duane Morris

The New Jersey Senate voted 33-4 yesterday (Thursday) to advance a bill that is intended to increase medical marijuana sales and likely create new business opportunities in the state.

Per Marijuana Business Daily, before the vote, the Senate amended Assembly Bill 10 to allow marijuana workers to become union members.

The Bill will now return to the NJ Assembly for a vote to approve the Senate’s modification.

If the Bill is ultimately signed, the measure will:

– Create a new regulatory commission for medical marijuana.
– Pave the way for the state to issue additional business licenses.
– Allow cannabis home delivery.
– Ease restrictions on the process for recommending medical marijuana.

Currently there are 12 vertically integrated medical cannabis licenses that have been granted in NJ.

We will continue to track this development and report back as it get’s closer to passage in the Assembly. -Brad

N.J. Appellate Division: Employee Stated Viable Claim Against Employer for Failure to Accommodate Off-Duty Medical Marijuana Use

In a recent decision approved for publication on March 27, 2019, the New Jersey Appellate Division addressed an issue of first impression: whether an employee can state a claim for disability discrimination based on an employer’s refusal to accommodate legal, off-duty use of medical marijuana, as permitted by the New Jersey Compassionate Use of Medical Marijuana Act (Compassionate Use Act).

In Wild v. Carriage Funeral Holdings, Inc., et al., A-3072-17T3 (N.J. Super. Ct. App. Div. Mar. 27, 2019), the plaintiff was a licensed funeral director for Carriage Funeral Holdings, Inc. (Carriage). His duties included, among other things, driving the funeral home’s hearse and other vehicles. After working for Carriage for approximately three years, the plaintiff was involved in a car accident in the course of his employment. At the time of the accident, he was driving one of Carriage’s vehicles during a funeral when another driver ran a stop sign and struck the vehicle driven by the plaintiff.

Read the full Alert on the Duane Morris LLP website.

NJ Adult Use Bill – Two Steps Closer to a March 25th Vote – Brad A. Molotsky, Esq.

According to late night reporting from NJ Biz – Dan Munoz, who has been all over this topic, committees in both the NJ Assembly & Senate approved a measure that would legalize adult-use recreational marijuana, setting the proposals for a showdown full-floor vote in 7 days from now on March 25.

Senate Bill 2703 passed by a 6-4 vote with one abstention in the Senate Judiciary Committee Monday evening while its counterpart, Assembly Bill 4497, passed by a 6-1 vote with two abstentions at the Assembly Appropriations Committee.

Both measures would allow for anyone over 21 years of age to possess up to an ounce of marijuana.

The product would be taxed at $42 an ounce and the industry would be regulated by a five-person Cannabis Regulatory Commission, which will function similarly to how the Casino Control Commission operated following the legalization of gambling in the 1970s.

The approval of both measures followed hours of closed-door meetings as lawmakers hammered out last-minute changes to the legislation, including a dramatically increased expungement process for people with marijuana-related convictions.

Stay tuned for a detailed analysis as the final bill is published. – Brad