Cannabis Client Alert - Week of August 16, 2021

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In this week’s edition:

  • Senate’s bipartisan infrastructure deal would allow researchers to study cannabis from state-legal dispensaries
  • Senate Appropriations Committee encourages reconsideration of hemp THC limits and regulatory pathway for CBD products
  • Illinois issues 55 new recreational cannabis dispensary permits, but lotteries to award an additional 130 licenses may remain in limbo
  • Illinois, Mississippi and Missouri set new cannabis sale highs
  • And more…

Federal

Federal Science Agency Issues First Report on THC and CBD Variability in Cannabis Laboratory Testing Results - The National Institute of Standards and Technology (NIST) published a new report addressing the widespread variability that exists between testing labs and their methods. The report is a part of NIST’s effort to ensure that cannabis products are accurately tested and labeled for THC, CBD and other cannabinoids.

Senate’s Bipartisan Infrastructure Deal Aims to Let Researchers Study Marijuana From Dispensaries - The long-anticipated federal infrastructure bill approved by the Senate includes provisions that would allow researchers to study the cannabis purchased by consumers in state-legal dispensaries, as opposed to restricting their research to government-cultivated cannabis. The proposed bill directs the secretary of transportation to coordinate with the attorney general and the Department of Health and Human Services to present a report within two years on progressing scientific research into cannabis impairment on drivers who use state-legal cannabis.

Federal Agency Loosens Marijuana-Related Grant Funding Restrictions for Mental Health Treatment - The federal Substance Abuse and Mental Health Services Administration (SAMHSA) relaxed its restrictions on grant funding for state health providers and other entities that allow patients to use medical cannabis for mental health treatment. Notwithstanding the changes, SAMHSA will retain a restriction providing that federal funds “may not be used to purchase, prescribe, or provide marijuana or treatment using marijuana.”

States

IL - Illinois recreational cannabis sales hit a record $128 million in July, and increase of 10 percent over the previous high of $116.4 million in May.

IL - The awardees of the latest batch of 55 permits to operate Illinois recreational cannabis dispensaries include former NBA stars Allen Iverson and Al Harrington, Cook County Commissioner Bridget Degnen, Fox 32 news anchor Robin Robinson and the indicted son of former state representative Eddie Acevedo. A third and final dispensary lottery for 75 additional licenses was scheduled for late August, however, a state judge recently ordered Illinois not to award any new adult-use retail licenses until a ruling is handed down on a lawsuit by the Wah Group challenging the application process.

ME - A federal court ruled that Maine may not exclude out-of-state companies from operating medical cannabis dispensaries in the state.

MI - According to data released by Michigan’s Marijuana Regulatory Agency, statewide cannabis sales reached another high last month, with more than $171 million in cannabis transactions.

MI - Michigan Attorney General Dana Nessel submitted a brief to a case before the state Unemployment Insurance Commission asserting that legal cannabis use should not be grounds for disqualification from unemployment benefits.

MS - Mississippi Senate and House members are working toward a new proposal for a state cannabis program, and have suggested a draft may be in place to be considered under a special legislative session as early as this month.

MO - According to data published by the Missouri Department of Health and Senior Services, the state set a new record of $21 million for its highest monthly medical cannabis sales.

NJ - According to a report by the Gothamist, half the cities and towns in New Jersey are likely to ban adult-use cannabis businesses for the foreseeable future due to a looming hard deadline of August 21 to opt in or opt out of the industry.

OK - Oklahoma’s Medical Marijuana Authority released an updated listing of licensed medical cannabis dispensaries.

PA - A Pennsylvania state appeals court ruled that the state's law legalizing and regulating medical cannabis permits workers and job applicants to take legal action against employers for discrimination. The court found that while the 2016 Medical Marijuana Act does not expressly create a private right of action, one is implied given no state agency is granted the authority to enforce its anti-discrimination provisions.

PR - Puerto Rico Governor Pedro Pierluisi signed legislation into law protecting qualified medical cannabis patients from workplace discrimination. The legislation amends the US territory’s existing medical cannabis access law to classify registered patients as members of a protected class under Puerto Rico’s employment protection laws.

Hemp/CBD

Senate Committee Urges Rethink of Hemp THC Limit and Pushes CBD Regulations - The Senate Appropriations Committee, as part of legislation to fund the US Department of Agriculture (USDA), Food and Drug Administration (FDA) and other federal agencies for Fiscal Year 2022, voted to pass funding legislation and reporting requirements that encourage the federal government to reconsider “arbitrary” THC restrictions on hemp and maintain efforts toward a regulatory pathway for CBD products.

Washington Prohibition on Conversion of CBD to Delta-9 THC - The Washington State Liquor and Cannabis Board published a bulletin concluding that that processors licensed under state law may not legally convert CBD into delta-9 THC.

FDA Rejects Two Applications for CBD-based Dietary Supplements - The Food and Drug Administration rejected two “new dietary ingredient” (NDI) applications for full-spectrum hemp extract that contained cannabidiol.

Texas Ruling Means Smokable Hemp Can Be Sold in State, but Must Be Manufactured Elsewhere - A Texas appeals panel, in a suit challenging the state’s ban on smokable hemp, held that state regulators may enforce a ban on the processing and manufacture of products intended for smoking or vaping, however, they may not prevent such products made elsewhere from sale in the state.

International

Spain - News in the Regulatory Framework for Cannabis - After a long wait and three draft projects published and commented on by the public, Decree No. 811 of 2021 was issued in late July. It fully replaces the central rule that regulated safe and informed access to cannabis.

Business

Ben & Jerry’s has moved to block MJ Munchies Inc., a cannabis snack company, from submitting applications to the Trademark Trial and Appeal Board for "Half-Baked" cookies and drinks, citing its ice cream flavor of the same name.

Leafly Holdings Inc., a leading online cannabis marketplace and consumer resource, and Merida Merger Corp. I, a special purpose acquisition company sponsored by Merida Capital Holdings, announced a definitive agreement to combine their businesses. Upon completion of the proposed transaction, Merida will adopt the Leafly name and is expected to be listed on the Nasdaq under the ticker symbol LFLY.

Dentons Speaks

Companies like Amazon are rethinking drug testing as cannabis legalization grows. Some Illinois employers will still fire you for it - Bob Channick of the Chicago Tribune published an article following a conversation with Dentons partner Eric Berlin on the federal cannabis legalization bill.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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