A key ruling in the fight to allow marijuana delivery everywhere in the state – regardless of local restrictions on marijuana retailers – was issued partially in the industry’s favor. Still, our Los Angeles marijuana business lawyers recognize it wasn’t all good news, and likely is just the beginning of what could be numerous, protracted legal battles.
The Fresno County Superior Court earlier this month upheld the California law allowing licensed marijuana delivery companies to offer services anywhere in the state. Further, the ruling affirmed that while cities and counties can forbid these operations, enforcement is up to local government agencies.
What does this mean for marijuana delivery businesses? As our attorneys see it, they have one of two options:
- Take the risk of battling with local governments trying to enforce their local bans on cannabis companies (including delivery services).
- Cease delivery services to those areas.
Those that want to take their chances and continue operating in markets where cannabis shops are banned may need to be prepared to litigate this – one local government at a time. That spells particular trouble for mom-and-pop operations, which have already been struggling with cumbersome regulation, taxing, lack of banking/credit services and black market competition.
The lawyer for the 25 local government plaintiffs in the case declared the ruling a victory for their side, saying it “clearly” underscores the rights of counties and cities to ban or regulate cannabis deliveries from outside companies.
Even though the ruling was first reported as a “victory” for marijuana delivery services, this was a bit misguided. The fact is, the ruling was a hair-splitting one that essentially stated the state law regulates licenses and not local jurisdictions, so the court did not find a conflict. That doesn’t necessarily mean delivery services can operate anywhere regardless of local law. They can try, but they are risking a lawsuit.
It will be imperative for delivery operators to invest the time, money and legal resources ensuring that delivery is legal in every location where they operate if they want to avoid run-ins with police and local government agencies. If you plan to operate a marijuana delivery company in California, you will need to know the specific local law in each city to the letter.
California has 540 city and county governments. As of last month, just 187 of them allowed licensed marijuana retail businesses. Another 42 allow for delivery services established outside of their jurisdiction to operate within their borders.
That said, it’s well-known that delivery bans are extremely difficult to enforce. Marijuana delivery services are barred by state law from advertising their cannabis company on the exterior of their vehicle. That means delivery service vehicles essentially look like any other. Police would have a difficult time distinguishing them from any other driver. Plus, whatever product is being delivered must be kept out of sight during delivery. If a stop is initiated, there will need to be reasonable suspicion that a crime has been committed. To search a vehicle without consent, law enforcement will need probable cause.
That’s not to say delivery drivers will be in the clear. We could expect to see sting operations set up. Penalties for violation of local ordinances may vary from city to city. In some localities, there may be a ticket, fine or other civil penalty. In others, we may see ordinances define violation as a criminal offense.
One hope we have is that this might be resolved through legislation. If state lawmakers approved a bill unequivocally granting marijuana delivery services the right to operate anywhere – regardless of local prohibitions – that could resolve the issue. It’s tough to say, however, whether that’s politically feasible.
More likely, a well-funded delivery service will need to poise themselves to challenge a local ban in court, the hope being the court would declare the ban unconstitutional or in violation of state regulation.
The bottom line is that licensed delivery operators (there are roughly 300 statewide) will need to decide – after careful consideration and consultation with their marijuana lawyer – whether to discretely continue normal operations or avoid the risk of a run-in with local law enforcement and halt operations in certain cities altogether.
The Los Angeles CANNABIS LAW Group represents growers, dispensaries, delivery services, ancillary companies, patients, doctors and those facing marijuana charges. Call us at 714-937-2050.
Court rules in favor of California’s statewide cannabis delivery policy, Nov. 19, 2020, Marijuana Business Daily