Curaleaf’s Application To Renew Adult-Use Marijuana Sales License Rejected By New Jersey Regulators

“It seems there’s still a lot of information missing that should be provided, and that should be done in a way, in a manner that is forthcoming and transparent.”

By Sophie Nieto-Muñoz, New Jersey Monitor

Cannabis regulators on Thursday denied Curaleaf, the biggest player in New Jersey’s nascent cannabis industry, a renewal of the license that allows it to grow and sell recreational marijuana in the Garden State.

The vote represents a surprising blow to the cannabis giant, and comes just about a week before the first anniversary of recreational weed sales in the state. It left observers stunned, and a representative of Curaleaf seeking help from the attorney general and wondering aloud about legal action.

Without a license, Curaleaf’s approval for recreational sales lapses on April 21. It remains unclear what the change means for its customers seeking medical marijuana, what happens to the company’s stores in Bellmawr, Edgewater Park and Bordentown, and whether the company can appeal the decision.

Thursday’s vote by the Cannabis Regulatory Commission comes a month after Curaleaf confirmed it is closing one of its growing facilities and laying off 40 workers. Commission members cited the closure, along with the company’s clash with unionization and its lack of transparency with the state, as reasons for rejecting Curaleaf’s license renewal.

“I think it’s important for the board to have staff at large to have proper insight and timely notice of major changes to facility operations,” said commission Chair Dianna Houenou. “It seems there’s still a lot of information missing that should be provided, and that should be done in a way, in a manner that is forthcoming and transparent.”

Only one member of the commission—Samuel Delgado—voted to approve the annual license for Curaleaf, one of the biggest cannabis companies in the nation.

A Curaleaf spokesperson called the commission’s action an “outrageous act of political retaliation” that lacks merit and legal basis.

“Most alarmingly, it will adversely impact our employees—nearly 500 New Jersey residents and Curaleaf team members—as much as it will harm the broader New Jersey cannabis market,” the company said.

Please see our statement regarding today’s decision by the New Jersey CRC. $CURA $CURLF pic.twitter.com/1AHyF0vPwn

— Boris Jordan (@Boris_Jordan) April 14, 2023

Cannabis advocates and potential licensees in the commission’s packed meeting room in Trenton were stunned by the vote’s outcome. People whispered to each other afterward, asking what it meant for Curaleaf’s products, consumers in South Jersey, and the industry as a whole. One person clapped.

The legal recreational cannabis industry launched in New Jersey nearly a year ago, so alternative treatment centers—or medical dispensaries—that were the first to receive approval to sell recreational marijuana were up for license renewals Thursday. Curaleaf was one of the seven companies to get the first go-ahead to sell recreational cannabis products last year.

Ahead of the vote, Commissioner Krista Nash noted that the state’s legalization law includes a requirement for cannabis businesses to maintain a labor peace agreement—where unions and employers agree on certain rights in exchange for agreeing not to strike—as a condition of licensure, and mandates collective bargaining within 200 days after a dispensary first opens if the majority of employees vote to form a union.

Nash stressed this was a requirement intentionally inserted by lawmakers, “not a challenge for companies to find a loophole in the law. It is an explicit mandate.”

“People have different definitions of what ‘maintain’ means. If you maintain your car, I don’t know if that means letting it sit in a garage. But it doesn’t mean, in this term, filing an agreement away in a drawer, but rather to implement the terms of what parties agreed to do,” said Nash.

James Shorris, Curaleaf’s chief compliance officer, spoke on behalf of the company at Thursday’s meeting. Shorris touted the company’s investments in the state, high sales to medical and recreational consumers and job creation with an emphasis on diversity. He also defended the closure of the Bellmawr grow site, citing changes in demand for flower and cost concerns.

Houenou said she was “encouraged” by Curaleaf’s diversity efforts, but still had to cast her “difficult vote.” Houenou abstained from the vote.

In other states, Curaleaf has clashed with unions, and the National Labor Relations Board cited the company last year for refusing to bargain with unionized workers in Chicago.

Several other dispensaries, like Verano, Acreage, Terrascend and Rise, were approved for annual licenses Thursday.

The commission also canceled its meeting in May. It will meet next in June.

This story was first published by New Jersey Monitor.