By Diana Novak Jones
(Reuters) – A New York state judge has invalidated most of the state’s cannabis regulations in a case that challenged marijuana advertising rules.
New York Supreme Court Justice Kevin Bryant said in an order on Wednesday that the state had not justified its rulemaking process in a raft of regulations put forward by the New York Office of Cannabis Management governing licensing, business operations and marketing of cannabis.
The judge in Albany criticized the Office of Cannabis Management and the New York Cannabis Control Board’s response to the lawsuit filed by cannabis website Leafly Holdings, saying they presented no evidence or justification to explain how the regulations were developed.
Leafly had sued over a rule that barred dispensaries from advertising on third-party platforms.
“There is no indication that any evidence was actually placed before the administrative agency and there is no outline of the process that the agency followed when deliberating regarding the proposed regulations,” the judge wrote.
A spokesperson for the New York Attorney General’s office, which defended the regulations in court, directed questions about the ruling to the state Office of Cannabis Management. The Office of Cannabis Management did not immediately respond to a request for comment.
Leafly in a statement said it is important that licensed operators have access to advertising tools to help them succeed and that the company hopes the ruling “ultimately leads to a healthy, stable adult-use market in the state.”
Jonathan Havens, a cannabis attorney in New York at law firm Saul Ewing who is not involved in the lawsuit, said if the ruling stands as is, it will have a significant and broad impact on the New York cannabis industry.
“It didn’t strike down the entire program, but I find it challenging to understand how there can be a fully functioning program if this isn’t immediately addressed,” Havens said.
(Reporting by Diana Jones; Editing by Leigh Jones and Bill Berkrot)
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