The 21 In Cannabis To Watch In 2021

New Jersey’s legal marijuana industry is in its embryonic stage. There is still no law on the books, and the government body charged with regulating the industry is not yet created. But there are many entrepreneurs, social justice advocates, attorneys and other professionals who are eager to help shape the mighty market that everyone expects will grow in the Garden State.

NJ Cannabis Insider developed this list of people and companies to watch as this process unfolds. We include companies with plans to expand the number of medical marijuana retail sites because they will be the first to sell to the adult use market and the market has been stifled so long. We also include people who wield influence in Trenton because so much work remains to be done at the legal and policy level.

1. Alternative treatment centers Columbia Care, Harmony Foundation and Curaleaf and TerrAscend all plan to add satellite locations to sell medicinal marijuana this year.
2. Josh Bauchner, head of the Cannabis Law Practice Group for Ansell, Grimm & Aaron in Woodland Park, has challenged the state Health Department’s licensee decisions in 2018 and 2019 on behalf of unsuccessful applicants. Some blame him for holding up the sorely needed expansion of the medicinal market. But when an appellate court decided in November the state’s process in 2018 of awarding licenses was confusing and lacking in transparency, it gave losing applicants hope they may have a shot in the future.

3. Rev. Charles Boyer, pastor of Bethel A.M.E. church in Woodbury and the founder of Salvation and Social Justice— has been and will continue to be a prominent voice for equity, influencing legislation and policy.

4. Jeff Brown, the Assistant Health Commissioner overseeing the medicinal marijuana program. has been tapped as executive director of the Cannabis Regulatory Commission, which will run both medical and adult-use markets.

5. Bill Caruso, attorney and managing affairs director for Archer Public Affairs is also a founding member of New Jersey United for Marijuana Reform. The former executive director of the Assembly Majority Office continues to advise lawmakers drafting the legalization bill.
6. Coalition for Medical Marijuana – New Jersey, the community organization that championed the law long before it gained traction in Trenton, will continue to bang the drum for home-grow. Their fight is gaining converts and attention.

7. Jackie Cornell, chief of policy and health innovations at cannabis company 1906, and Jacqueline Ferraro, VP of business development for Full Steam Staffing, have joined forces to launch the Cannabis Advisory Group, a newly formed professional organization that has already begun surveying municipalities on their concerns surrounding legalization.

8. New York Gov. Andrew Cuomokicked off 2021 by introducing a plan to legalize marijuana in his state this year. That could make New York the Garden State’s only nearby competitor in the new market, and could influence the size of New Jersey’s market.
9. Ed DeVeaux, lobbyist for Burton Trent Public Affairs, is the new president of the leading trade group, the New Jersey CannaBusiness Association. He replaced founder Scott Rudder late last year.

10. Sarah Fajardois the policy director of ACLU-NJ. She provided expert testimony in many legislative hearings in 2020. Her organization continues to advocate for racial and social justice provisions in the rollout of the enabling legislation and decriminalization.

11. Ed Forchion, known asNJ Weedman, remains a fearless trailblazer and rabble-rouser from his cannabis cafe, NJ Weedman’s Joint in Trenton. Openly selling personal-use cannabis across the street from Trenton City Hall, he will continue to push the boundaries of what the law allows.

12. Jessica Gonzalez is the general counsel for Minorities for Medical Marijuana and was a vocal advocate for equity in licensing and taxation during the passage of S21/A21.

13. Dianna Houenou, president of the yet-to-be-constituted Cannabis Regulatory Commission, worked for the ACLU of New Jersey and ran point on social justice issues involving marijuana before Gov. Phil Murphy hired her as a senior Policy Advisor in 2019. People are counting on her sensitivity and integrity to set an example for the nascent industry.

14. Janice Kovach, president of the N.J. League of Municipalities, along with Mike Cerra, the league’s executive director, will have a lot to say about what the local impact of the industry should be.

15. David Nathan, founder of Doctors for Cannabis Regulation, has rallied the members of the medical community around marijuana reform. He has proposed a system that would create uniform regulations for labeling cannabis products.

16. Tara “Misu” Sargente, owner of Blazin’ Bakery and podcaster traded her position as executive director for the NJ CannaBusiness Association for board member. She’ll remain a recognizable industry influencer.

17. Scotts Miracle-Growas the biggest financial booster of the legalization constitutional amendment. Look for this Ohio-based company to bring its hydroponic product line to the Garden State for cannabis growers.
18. Susanna P. Short,a cannabis industry consultant with iAnthus and member of New Jersey Cannabis Trade Association, emerged from behind the scenes in 2020. She’s been influential in getting the existing ATCs to work together on issues like online ordering and home delivery.

19. Beth Stavolaand iAnthus: The two are in a legal fight for control over MPX NJ, which was expected to open in Pleasantville and Atlantic City last year. A court last month issued an interim order that gave some control back to Stavola after iAnthus allegedly steamrolled the company.

20. State Sen. Troy Singleton, D-Burlington, has introduced a bill (S2875) that would allow ATCs to invest in licenses held by minorities, women and veterans. It could shape how minority licensees seek funding, and also increase the power of existing ATCs in the state. He also was instrumental in leading the behind-the-scenes conversations that led to a deal on the legalization bill in December (before it stalled again.)
21. The United Food and Commercial Workers already represents some cannabis employees in New Jersey, and represents thousands nationally. Expect the union’s relevance and interest to grow in New Jersey because the state expects operators to have “peace agreements” with unions, which say the company will agree not to oppose union activity.

— Susan K. Livio, Amanda Hoover and Enrique Lavin 

NJ Pot Advocates Say License Caps Could Shape Industry – By Diana Novak Jones

Law360 (December 23, 2020, 4:39 PM EST) — As legislation framing the new adult-use marijuana market in New Jersey awaits the governor’s signature, advocates say one of the most consequential decisions for what could be the industry’s most lucrative state has yet to be made.

New Jersey’s proximity to New York and Pennsylvania — two populous states without legal recreational marijuana — will mean its adult-use marijuana businesses could have near-exclusive access to one of the most densely populated parts of the country.

Legislators have drafted the first rules for the industry, and they already include a restriction on the number of cultivators. If Gov. Phil Murphy signs off, the process will move into regulators’ hands. It’s there that the competition could ramp up, depending on whether the Cannabis Regulatory Commission decides to limit the number of dispensaries and other marijuana businesses.

If they do, the fight could be just getting started, advocates say.

Joshua Bauchner, head of the cannabis practice group at New Jersey law firm Ansell Grimm & Aaron PC, pointed to the “green trail,” a reference to Interstate 91, as evidence people will travel for marijuana.

New Yorkers drive between two and three hours on the interstate to reach Massachusetts, where they can access recreational marijuana dispensaries, Bauchner told Law360. Soon, they’ll instead be able to ride a New Jersey transit train for 15 minutes, he said.

And if regulators decide to put caps on dispensary licenses, “the few operators that are lucky enough to get a license will basically have monopolistic power,” he said.

A Sticking Point

A key feature of many states’ forays into recreational marijuana has been to cap the number of licenses issued, and New Jersey has been no exception so far.

Caps on cultivation were among the hotly debated elements of New Jersey’s recreational pot legislation, spurred by concerns about controlling the amount of product available, according to Harris Laufer, the legislative director for New Jersey State Sen. Nick Scutari, D-Union County, who led the push for the bills. The legislation that passed New Jersey’s Legislature on Dec. 17 came with a cap of 37 cultivation licenses.

Scutari has been working toward legalizing recreational pot since he joined the Legislature in 2004, in a process that has been repeatedly stymied by reluctant lawmakers. He said it would not have happened this year without voters’ clear support on the measure.

“If that didn’t happen, I can think of a few legislators that would not have voted for it,” Scutari said.

Scutari prefers a free-market approach, but the cap on cultivators was a critical part of the negotiations to get the deal on the legislation done, Laufer said. And the cap, which expires after two years, covers both medical and recreational cultivators, so many of the licenses are already claimed.

Scutari said he worked with the governor’s office to craft this legislation, so he is confident it will get Murphy’s signature.

But with the restriction on cultivators in place, many in the industry are wondering whether more limits are on the way.

Once Murphy approves the legislation, the rest of the state’s pot regulations will be drafted by the Cannabis Regulatory Commission. Murphy has been selecting the commission’s members since earlier in fall.

The licensing process needs to be put together, then the licenses need to be awarded, Scutari said.

“There’s a lot to that,” he said, predicting it will be at least six months before the licenses go out.

Cap Concerns

The Garden State’s potential as a new marijuana market has many in the industry worried about caps on businesses like dispensaries and producers, and what that could mean for businesses hoping to get a foothold.

Nothing is finalized yet, but advocates for different groups say limits on licenses could leave a lot of people out of the burgeoning industry. And once the legislation is signed, it will be up to the Cannabis Regulatory Commission to decide whether to include them.

Representatives for Murphy declined to comment or make the newly chosen head of the commission, Dianna Houenou, available to speak about the coming regulations.

One group concerned about the use of caps are those behind the ballot measure that legalized marijuana.

Amol Sinha, executive director of the American Civil Liberties Union’s New Jersey chapter and chairman of the ballot measure initiative, NJ CAN 2020, said caps are a problem when it comes to the group’s goal of improving access to the industry for people impacted by the war on drugs.

“They eliminate competition, they artificially keep the price of cannabis high,” Sinha told Law360.

Caps “make it hard for everyday people to obtain a license. Only the people who are already set up are going to get those, and usually those are big operators,” Sinha said.

Sinha applauded a part of the legislation that sets aside 70% of the sales tax and additional fees from legal marijuana for impact zones, which he said were largely minority communities across New Jersey. The ACLU put its weight behind that measure after initial proposals had the bulk of the money going to law enforcement, he said.

But the legislation doesn’t have a plan to set aside licenses for equity applicants, or people disproportionately hurt by marijuana prohibition, he said. That will also be up to the regulators, Sinha said.

Another person watching to see what happens with the regulations is Bauchner, who is representing several would-be medical marijuana operators in two separate and ongoing lawsuits over New Jersey’s medical marijuana licensing process.

The lawsuits target the New Jersey Department of Health, which oversees medical marijuana, deciding how many dispensaries the state will have and who gets them. Bauchner says the regulators for recreational marijuana should expect competition for the licenses to be fierce.

“If past is prologue, everyone is going to be interested in the adult-use market,” he said.

If caps are put in place, there will likely be more litigation, Bauchner added. And he thinks caps are likely, given their political support.

“We’re likely to see, as we have in the past, hundreds of applications,” he said. “The problem then becomes qualified applicants are being denied the right to pursue that option because of an arbitrary cap.”

Limits will likely also have the backing of major marijuana companies, which are already present in the state’s medical industry, Bauchner said.

If regulators rely on caps, “they’ve created a system where the stakes are so high, it engenders litigation and it permits monopolistic conduct,” he said. “It’s going to yield problems.”

–Additional reporting by Bill Wichert. Editing by Nicole Bleier.

NJ Appeals Court Vacates and Remands 2018 MMJ Disqualification Decisions: Victory for Appellants, Government Transparency, and NJ MMJ Patients

The New Jersey Appellate Division this morning issued its Decision vacating the Department of Health’s final agency decision in the 2018 Medical Marijuana Request for Applications process and remanding for further proceedings to address the endemic scoring defects and related problems.  The Decision is available here.

In its 75-page Decision, the Court extensively reviewed the scoring irregularities which rendered the DOH’s disqualification of Appellants arbitrary, capricious and unreasonable:

In short, all roads lead to the same point: numerous, indisputable anomalies in the scoring of the appellants’ applications prevent us from having sufficient confidence in the process adopted by the Department or its results for the approval of ATCs in this important industry that provides ‘beneficial use[s] for . . . treating or alleviating the pain or other symptoms associated with’ certain medical conditions. N.J.S.A. 24:6I-2(a). It is for this chief reason that we remand to the Department to undertake further steps to ameliorate these concerns.

The Court concluded that “the Department tolerated too great a degree of ‘relative error’ in its scoring, its decisions were arbitrary, capricious and unreasonable. This argument, with which we agree, is demonstrated by numerous examples that simply cannot be rationally explained on the record before us.”

The Court further unequivocally rejected the Department’s excuses for the scoring anomalies:

The Department has done little to justify these anomalies or explain why they should be disregarded. We would characterize the Department’s contentions as falling into two general assertions: (1) the divergent scores in some instances are the product of “each member appl[ying] his or her unique expertise to the scoring process,” and (2) all applicants were subject to the same process and, therefore, all buoyed or dragged down by the varying scores. The former is unconvincing because it runs counter to the fact that the Department provided each review committee member the same set of instructions that it presumably sought to have applied in the same way, as well as the rather obvious likelihood that the Department did not intend – nor should it have intended – to allow reviewers’ personal views to enter into the calculus. We are also unpersuaded by the Department’s false-equivalency argument. It is certainly true that the winning and losing applicants were subjected to the same review committee, and there may be evidence of similar inconsistent scoring of the winning applications, but that doesn’t mean that they were entirely treated the same way.

In dismissing these arguments, the Court succinctly explained:  “There is no escaping the fact that some of these scores simply ‘don’t compute’ and that, no matter how the Department and the other respondents may attempt to slice it, the results are still unsettling.”  The Court then ordered that:  “The Department must address the numerous questions posed about its scoring procedures and explain the basis for its resolution of the remand proceedings before we can ever adequately review whatever final agency decisions come from those proceedings.”

In reaching its Decision, the Court also telegraphed its concerns regarding the pending 2019 Medical Marijuana Request for Applications:

We intervene in the administrative proceedings that have taken place so far to ensure the public’s confidence in both the results achieved at the agency level so far and to ensure that future similar proceedings will be likewise subjected to a measure of scrutiny at the agency level that will guarantee the process does not produce determinations that are arbitrary, capricious or unreasonable.

As to a remedy, the Court explained that it “will not dictate to the Department what it is that it should do following today’s remand, other than to hold that it must engage in some sort of additional process for receiving and considering the appellants’ contentions and must explain its determinations on those contentions.”  As an administrative hearing likely only will reveal additional problems, and the Court repeatedly noted the option to award more licenses, there is hope on the horizon for expanding patient access in New Jersey to much-needed medicine in the near term.

Open Letter to Attorney General Gurbir Singh Grewal

Ansell Grimm Adds Application Writer-Attorney To Cannabis Law Practice

Ansell Grimm & Aaron, PC announces that Ariana Van Alstine will be coordinating with the firm to assist in the preparation of applications for cannabis licenses in the State of New Jersey.  The addition of Ms. Van Alstine expands the firm’s already robust Cannabis Law Practice Group, enabling it to further support its clients in licensing, corporate formation and governance, commercial leasing, contract negotiation and drafting, employee issues, capital raising and financing, and regulatory and municipal compliance.

Ms. Van Alstine is an attorney and consultant to the cannabis industry who is widely recognized for her ability to support clients to accomplish business goals within the context of complex regulatory frameworks.  Ms. Van Alstine has successfully worked with clients to win numerous local competitive license processes, guided the state license process for nearly every license type, guided clients through multi-state expansion processes, and navigated the cannabis regulatory hurdles in dozens of commercial, real estate, and acquisition agreements. In addition to working with cannabis businesses, she works with platforms and financial service providers to navigate cannabis regulatory hurdles.

Prior to founding AAVA Consulting, Ms. Van Alstine was Vice President of Legal and Regulatory Affairs at Connected California, a vertically integrated multi-state cannabis business. At Connected, she oversaw the company’s legal, compliance, and regulatory affairs departments.

Ms. Van Alstine is regularly invited to share her unique knowledge of cannabis law. She taught an executive training on cannabis licensing for University of the Pacific, McGeorge School of Law, and has provided continuing legal education to the Sacramento County Bar Association. Past speaking engagements include California Cannabis Industry Association’s Risk Management Conference, The State of Cannabis, Urban Exchange Speaker Series, California Cannabis Courier’s Association: Ask the Lawyers, McGeorge School of Law: Cannabis Law Symposium; McGeorge School of Law Cannabis Licensing Seminar; Sacramento County Bar Association: Cannabis Law Section on Licensing, Sacramento County Bar Association: Cannabis Law Section on Record Keeping, and Payroll Systems: MRB Compliance Seminar.

Ms. Van Alstine is a California Super Lawyer, Rising Star. She sits on the Board of Women Lawyers of Sacramento, and on the Advisory Board for Khemia Manufacturing and Tracy Cannabis Collective. She has also sat on the California Cannabis Industry Association’s Legislative and Insurance Subcommittees. Ms. Van Alstine is a member International Cannabis Bar Association, the Women in Cannabis Chamber of Commerce, the Sacramento County Bar Association, and Barristers’ Club of Sacramento. In her spare time, she volunteers as an Alumni Coach for the McGeorge School of Law Honors Board Asylum competition.

Ansell Grimm is pleased that Ms. Van Alstine is bringing her extraordinary experience to service its cannabis clients.  Our dedicated Cannabis Law Practice Group stands ready to assist applicants with ensuring they are prepared when the Request for Applications is issued for adult use cannabis, as well as for additional medical licenses.  Please contact Joshua S. Bauchner, head of the Cannabis Law Practice Group, at jb@62q.f7d.myftpupload.com or (973) 247-9000 to get started today.

Recreational Marijuana Legalized by New Jersey Voters

As the New York Times reported, after years of legislative failures, New Jersey voters on Tuesday authorized the legal use of recreational marijuana in a year when supporters rallied around the disproportionate number of arrests for the drug in minority communities.

The ballot question passed as expected, by a wide margin, according to preliminary results from The Associated Press.  The vote allows New Jersey officials to begin the thorny, potentially lengthy process of establishing rules related to regulating and testing cannabis and issuing licenses, including how many permits to grant — and to whom.

The question New Jersey voters approved called for a 6.625 percent state tax on marijuana sales to customers 21 or older, and permitted municipalities to charge an extra 2 percent tax. But most other implementation details must now be worked out by the Legislature and a Cannabis Regulatory Commission with five members — only one of whom has been appointed.

The potential for extra tax revenue and new jobs may serve as a powerful motivator to move quickly in New Jersey, which is struggling to plug budget gaps left by a pandemic now stretching into its ninth month. The measure is expected to generate about $126 million a year once the market is established.

Ansell Grimm & Aaron, PC’s dedicated Cannabis Law Practice Group stands ready to assist applicants with ensuring they are prepared when the Request for Applications is issued, including, among other things:  corporate formation and governance, leasing, property acquisition, capital raising and financing, distribution agreements, licensing, and regulatory and municipal compliance.

Please contact Joshua S. Bauchner, head of the Cannabis Law Practice Group, at jb@62q.f7d.myftpupload.com or (973) 247-9000 to get started today.

The State of Cannabis: NJ’s Upcoming Ballot Referendum on Adult-Use

October 28^th, 2020 6:00pm-8:00pm

Via Zoom

Join us on October 28th for a timely and important discussion where our distinguished group of panelists will address cannabis at the federal level, and then hone in on what’s happening in NJ with the current medical operators, the prospect for adult-use if the referendum passes, and the viability of applying for and securing a license to operate.

Our moderator is Joshua S. Bauchner, head of the Cannabis Practice Group at the law firm Ansell Grimm & Aaron PC, who will be joined by panelists Art Hance, President, Hance Construction, Todd Johnson, Executive Vice President and Head of New Jersey Operations for Justice Grown and President of Community Greenhouse, and Jeff Monat, Senior Partner at Merida Capital.

To register for the event, click here.