A group representing Santa Ana’s licensed marijuana dispensaries has filed a lawsuit targeting unsanctioned pot shops in the city, taking aim at a purported black market that some say could put the regulated retailers out of work.
The lawsuit filed on behalf of the Santa Ana Cannabis Association this week in Orange County Superior Court lists 14 unlicensed dispensaries the organization alleges are operating outside of the law, ignoring city safety codes and undercutting the dispensaries that are licensed to operate in the city.
The lawsuit marks the latest legal battle over Measure BB, a city initiative approved in 2014 that called for 20 medical-marijuana dispensary licenses in Santa Ana to be approved by lottery.
Despite the move to regulations, the number of licensed dispensaries in Santa Ana has at times been dwarfed by unlicensed ones.
“Measure BB was established to provide guidelines for the operation of a medical-marijuana dispensary, including the requirements for obtaining a license to operate such a business – a license that all 14 of these facilities fail to possess,” said David Welch, an attorney representing the Santa Ana Cannabis Association, in a statement.
“These facilities do not pay city taxes, provide proper on-site ventilation, which negatively affects the air of surrounding communities, and have not ensured their employees have undergone background checks,” he said.
Attorneys with the law firm of McGrath, Pappas and Pinchiff, which represent some of the dispensaries named in the lawsuit, accused the lawyers tied to the Santa Ana Cannabis Association of trying to close down and shut out competitors.
The attorneys indicated that they plan to fight back against the lawsuit, alleging that the lottery that led to the licensed dispensaries wrongly leaned toward groups that had made political donations to Santa Ana politicians.
“Actions by (association lawyers) to protect the profits of their clients who obtained licenses through political contributions and anti-competitive methods are not only improper, but designed to harm the patients for whom medical cannabis was provided by the voters,” McGrath, Pappas and Pinchiff said in a statement.
The lawsuit seeks an injunction to shut down the unlicensed medical-marijuana shops, as well as an unspecified court judgment on behalf of the licensed dispensaries. No hearings have been scheduled yet.
The city itself has taken various steps to try and shutter pot shops without city permits.
Among the dispensaries targeted in the lawsuit is Sky High Holistic, which drew national attention after Santa Ana officers were caught on camera eating snacks from the business during a 2015 raid. Attorneys for Sky High filed their own lawsuit against the city and Police Department last week, seeking $650,000 in property damage stemming from continued raids.
This story first appeared on OCRegister.com.
