East of Eden Cannabis Company, a state-licensed marijuana company in California, has filed a lawsuit against Santa Cruz County accusing the local government for violating the rights granted to the company by the state government.
The company asserts that the state law allowing companies to deliver marijuana to any part of the state, including areas that opted out of hosting marijuana businesses, is being trampled upon by the enforcement of the rules passed by the authorities in Santa Cruz banning the delivery of marijuana into their jurisdictions.
This lawsuit is the second on the controversy surrounding who should have the upper hand in determining where legal marijuana can be distributed within the state of California.
In its court papers filed with the Superior Court in Santa Cruz, the marijuana company argues that the county has threatened to initiate a criminal investigation against East of Eden and also seek to have its state license revoked for making marijuana deliveries in areas that don’t permit marijuana within their jurisdictions.
The company therefore requests the court to give it permission to resume making cannabis deliveries and also declare the rules of Santa Cruz on the matter as “void and unenforceable.”
In January this year, marijuana industry regulators in the state okayed a rule that would permit licensed marijuana companies to start making cannabis deliveries anywhere in the state, including in jurisdictions that had passed ordinances banning marijuana businesses.
This new rule drew the wrath of anti-cannabis groups who said that the state was reversing the promise made by the voter measure which stated that local authorities would have the liberty to either accept or ban marijuana companies from operating within their jurisdictions.
Police chiefs and the League of California Cities have voiced concerns that unrestricted home deliveries of marijuana pose a risk that a lot of marijuana transactions will go unreported and pave way for the black market to thrive.
Santa Cruz County, Beverly Hills and close to twenty other local authorities took the added step of suing the state government and marijuana regulators in order to have the home delivery rule reversed.
The conflict between the state and local the authorities has prevented the marijuana industry from reaching its full potential in the largest (so far) single cannabis market across the world. Industry watchers believe that the entire cannabis industry, including participants like The Green Organic Dutchman Holdings Ltd. (TSX: TGOD) (OTCQX: TGODF) and Sugarmade Inc. (OTCQB: SGMD), will be following these legal battles closely because the decision of the courts could change the trajectory of the industry in all the states where marijuana is legal.
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