LA Sued for Prioritizing Social Equity Licensees for Cannabis Delivery

Los Angeles, California and the Department of Cannabis Regulation are being sued over plans to issue stand-alone cannabis delivery licenses exclusively to social-equity applicants until 2025, the Associated Press reports. The lawsuit does not seek to limit such applicants to obtain licenses but wants all businesses the equal opportunity to apply.

The lawsuit was filed by cannabis firm Ganja Goddess, and trade groups Southern California Coalition and the California Cannabis Couriers Association. Ganja Goddess CEO Zachary Pitts described the regulations – which were revised in July – as a “death blow.”

The July regulation revisions came in response to a lawsuit against the city by the Social Equity Owners and Workers Assn. That deal saw the city agree to bolster its social equity program if the trade organization dropped its lawsuit.

Under the initial rules – scrapped under the reforms – Los Angeles was required by law to issue 20 licenses under a delivery pilot program. The lawsuit alleges that the plaintiffs’ rights were violated by “unreasonable delay and poor handling of the licensing process, followed by a change in the law,” according to the report.

Under Los Angeles’ adopted social equity rules, the city replaced its first-come, first-served system in favor of a lottery system, and narrowed the ZIP codes eligible for social equity licensing relief in the city after it was discovered that some wealthier, affluent, white neighborhoods were included among the list of ZIP codes eligible for the program. Licensing officials now use police reporting districts which officials say better target the communities most affected by the drug war for the licenses.