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Sacramento Boutique, in New Suit, Challenges Marijuana Delivery Regs

Eaze Billboard on Highway 101 in South San Francisco. Photo: Jason Doiy/ALM

A Sacramento boutique law firm known for its local government, land use and water practices will lead the legal challenge to overturn California regulations that allow marijuana deliveries throughout the state, even in jurisdictions that don't want them.

Churchwell White is representing one county and 24 cities suing the Bureau of Cannabis Control and its director, Lori Ajax, over the expansive delivery authority included in marijuana regulations approved in January. The suit, filed late Thursday in Fresno County Superior Court, asks a judge to invalidate the specific rule allowing statewide deliveries without local approval.

Churchwell White name partner Steven Churchwell is a former general counsel to the state fair political practices commission and a onetime lawyer at the Office of Administrative Law. Firm co-founder Douglas White is a land use attorney with an extensive history in state Capitol advocacy work.

Firm lawyers already serve as contract city attorneys or deputy city attorneys for nine of the city-plaintiffs.

"It kind of puts us in a unique position to understand what's going on and what's legal from a regulatory standpoint," said White.

A spokesman for the Bureau of Cannabis Control declined to comment on the lawsuit.

Dustin McDonald, vice president for government affairs at Weedmaps, the online marijuana directory, tweeted Friday that "25 CA local govts (16 of whose voters passed Prop 64 by 50% or more 2 yrs ago) sue state to suppress safe/legal access to patients in lieu of licensing legal retail. Choosing not to license retail is a deliberate choice to maintain a robust illegal market."

The plaintiffs contend that Proposition 64, the 2016 voter-approved initiative legalizing recreational marijuana, gave cities and counties broad control over whether and how to allow cannabis operations in their boundaries. Despite voters' overwhelming approval of the measure, a majority of jurisdictions have banned some or all kinds of commercial marijuana activities, from cultivation to retail sales.

Last year, then-Sen. Ricardo Lara, D-Los Angeles, introduced legislation, sponsored by WeDrop Cannabis Delivery, to prohibit cities and counties from barring deliveries. The bill was shelved amid concerns in legislative committees' analyses that the proposal could run afoul of voters' intent in passing Proposition 64.

Later that year, the bill's provisions appeared in draft marijuana regulations circulated by the Bureau of Cannabis Control.

“If we issue a license for delivery, which is a retail license, they can deliver anywhere in the state, regardless of whether there’s a ban in place (locally) or not,” Ajax told a meeting of the Cannabis Advisory Council in November. "Of course, a lot of cities don’t feel that way. They feel that if they have a ban, we’re eroding their local control at that point. The state looks at it as, when we issue a license, we don’t issue just to a premises, but you can conduct commercial activity all over the state.”

Despite complaints from cities, counties and law enforcement agencies, the statewide delivery language stayed in the final regulations approved by the Office of Administrative Law in January.

White said that some of his firm's city clients allow some type of locally permitted cannabis operations, but they fear having no control over the numbers and practices of state-licensed delivery services dropping off orders at locations in their boundaries.

"The issue really is not so much a ban" on marijuana businesses, said White. "The problem is these regulations have created a large proliferation."

White said lawyers at his firm have spoken with representatives of at least six other counties and 20 cities interested in joining the lawsuit.