VS Assists in Push for Responsible Fix to Massachusetts Adult-use Shutdown

Apr 1, 2020

In an effort to help prevent the spread of COVID-19, governors in several states around the country have ordered "non-essential" businesses to close their facilities to workers and customers. Fortunately, most state governments have designated medical cannabis businesses "essential" or otherwise allowed them to continue meeting the needs of licensed patients as long as they employ stringent protective measures to keep employees and customers safe. This has also been the case for adult-use businesses in most states where adult sales are regulated.

In Massachusetts, however, Gov. Charlie Baker chose to only designate medical sales essential, resulting in a total shutdown of adult-use sales on March 24. This is a massive blow to the state's legal cannabis industry, which relies heavily on adult sales and is not eligible for any federal aid due to the illegality of marijuana under federal law. As the managing partner of our Boston office told the Boston Globe:

“Massachusetts was already really slow and expensive, and as a result the businesses are heavily leveraged,” said Adam Fine, an attorney at the cannabis law firm Vicente Sederberg, whose analysts estimate the marijuana industry will lose hundreds of millions of dollars nationally and cut thousands of jobs amid the pandemic. “This is just going to compound that, and I think new operators will face the biggest challenges.”

VS is actively engaged in the effort to push for a responsible solution to the situation, working alongside a number of business owners, organizations, and state officials (including former VS team member and current Cannabis Control Commissioner Shaleen Title). We signed on to an open letter to state officials from more than 30 Massachusetts cannabis companies, underscoring their commitment to protecting public health and urging state officials to designate licensed adult cannabis sales as an essential service. It stressed the many public health and economic benefits of allowing adult sales to resume in a highly regulated environment, and it outlined a broad range of stringent protective measures the businesses could employ to ensure the safety of customers and employees. The businesses also addressed Baker's concern that allowing adult cannabis sales to resume would attract visitors from other states, stating they are fully supportive of limiting adult sales to only Massachusetts residents during this health crisis. 

At a March 31 news conference, Baker announced non-essential business closures are extended until May 4. He confirmed this includes adult-use cannabis businesses and reiterated his concern about attracting visitors from other states. When asked if sales could just be limited to state residents, he questioned the legality of prohibiting sales to non-residents.

The Boston Globe reported the news, highlighting both our coalition letter and a memo our public affairs consulting affiliate, VS Strategies, produced in anticipation of the governor's argument.

In an effort to assuage Baker’s fears about out-of-state customers, many in the cannabis industry, including cannabis Commissioner Shaleen Title, have recommended reopening adult-use marijuana stores for Massachusetts residents exclusively.

In a letter addressed to Massachusetts state officials yesterday, more than two dozen Massachusetts cannabis operators and applicants backed that idea, writing they are “fully supportive of limiting sales to Massachusetts residents during this health crisis and will not only enforce that policy, but will do our part to educate the public about that restriction once it is enacted.”

But when asked whether he would consider that on Tuesday, Baker said he wasn’t sure that was a legal option.

“I don’t know if you can do that legally," he said. "It’s certainly something that some folks have talked about.”

But some in the industry already argue that such a move would be legal, pointing to policies in Colorado that initially restricted non-residents to smaller purchase limits than residents. Jordan Wellington, vice president of policy for the consulting arm of national cannabis law firm Vicente Sederberg, said the example in Colorado “provides important insight into this matter.”

“As far as Massachusetts is concerned, it is hard to imagine a more substantial reason or legitimate end than preventing the spread of the coronavirus,” Wellington wrote in a memo Tuesday.

In addition to Colorado's experience referenced in the memo, it is worth noting that Illinois currently treats state residents and non-residents differently with regard to adult-use cannabis. 

If you live in Massachusetts, please visit this action page set up by the Marijuana Policy Project to send a message to Gov. Baker. Tell him you support limiting adult sales to state residents during this health crisis, and let him know you think safe and legal cannabis access is essential.

This article is for informational purposes only and not for the purpose of providing legal or tax advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. This material may be considered attorney advertising under certain rules of professional conduct.