Cannabis Dispensary Sues State Over Labor Peace Agreement Rules in Adult-Use Law

A New York City-based cannabis company is suing the state in federal court over the constitutionality of a requirement in New York’s adult cannabis use law requiring all industry licensees to have labor peace agreements, the Times Union reports. The lawsuit was filed this week in U.S. District Court in Manhattan by Hybrid NYC, a limited liability company that operates a dispensary in Brooklyn under the name Gotham. 

Under the legalization law, labor peace agreements are designed to protect “the state’s proprietary interests by prohibiting labor organizations and members from engaging in picketing, work stoppages, boycotts, and any other economic interference with the entity.” In the lawsuit, Hybrid contends that the “proprietary interests” provision makes the state an industry stakeholder which would violate federal law. Additionally, the lawsuit argues the agreements requirement violate the National Labor Relations Act, which “entrusts the federal government with exclusive and preemptive authority over labor relations in general and over the organizing process for all private sector employers in particular.”   

In the lawsuit, Hybrid argues that the labor peace agreement provision has led to a monopoly by Local 338, which represents grocery, pharmaceutical, health care, transportation, and cannabis workers. The lawsuit claims the union has become “one of the only – if not the only – labor union” that meets law’s standards, which is “further limiting the ability of cannabis license holders to meaningfully negotiate the terms of their (labor peace agreements).”    

The lawsuit is the first in the state challenging the labor peace agreements provisions.