The New Jersey Appellate Division recently affirmed a trial court’s decision to allow a New Jersey town to deny a prospective retail cannabis business to operate, determining that the municipality has the discretion to decide the necessary requirements for any cannabis retail businesses, and which cannabis retail businesses it chooses to support.
In December of 2022, a lawsuit was filed by Big Smoke LLC (“Big Smoke”), a prospective cannabis retail business, after the Township of West Milford declined to adopt a resolution in support of Blue Smoke’s cannabis retail operation in favor of another cannabis retail business in the same commercial complex. The lawsuit alleges that despite being granted a zoning permit for a retail store in December of 2021, Township officials did not adopt a resolution allowing Blue Smoke to move forward with operations in October 2022, required by the New Jersey Cannabis Regulatory Commission.
In April of 2022, between the time Blue Smoke was granted a zoning permit and when it requested a resolution, West Milford adopted a new ordinance mandating a 2,500-foot distance between cannabis retailers. In addition, SoulFlora, another prospective cannabis retailer in West Milford, obtained approval to operate a retail cannabis business in October 2021, at a location only 500 feet from Blue Smoke’s perspective location.
A trial court heard the case in January of 2023 and denied Blue Smoke’s request to block the issuance of licenses to Blue Smoke’s competitors and dismissed the complaint with prejudice.
In March 2024, the Appellate Division affirmed the trial court’s ruling, holding that West Milford has the authority to determine the requirements for cannabis businesses and which cannabis businesses it chooses to support. The appellate court ordered a limited remand to the trial court as the lower court did not provide a reason for dismissing the complaint with prejudice.
This case highlights the importance of prospective cannabis businesses to diligently monitor local regulations when applying for a cannabis license.
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