California Growers Association Drops Lawsuit Over Large-Scale Cannabis Cultivation

A lawsuit by the California Growers’ Association over the stacking of licenses by small-scale cannabis farmers to allegedly create large-scale grow sites, thereby subverting the intent of Prop 64, will be dismissed. Although neither the association, nor the California Department of Food and Agriculture (case defendant) have commented publicly on the motive for moving for dismissal, a couple of the growers who were the subject of litigation, having some 200 licenses each, say California is big enough to support small and large operations alike. Smaller growers, they say, can carve a cult-like following by capitalizing on the artisanal. Commercial production for things like medical-grade CBD and related products, however, can’t be produced practically for a profit by small-scale operations, they said.

As our Los Angeles marijuana attorneys can explain, the state’s Department of Food and Agriculture published its final rules for awarding marijuana grow licenses per Proposition 64, with licenses granted according to the size of the farm.

Licenses for “medium-sized” cannabis farms would allow one person or entity a maximum 1 acre outside or 22,000 square feet indoors. “Large” marijuana grow farms (larger than 1 outdoor acre or 22,000 feet of indoor space) aren’t being awarded until 2023, the idea being smaller, mom-and-pop grow operations will get a head start before the large agricultural companies can come storming in. There was, however, no designated license for “small” farms, at least initially.

Last year, the state agriculture department said it would be granting small licenses for indoor facilities under 10,000 feet. However, in doing so the department also said it would not place caps on how many licenses a small operation could obtain. These gave growers the ability to combine many small licenses to effectively run a large-scale marijuana grow operation. This has been seen so far most often in Santa Barbara County, which is gaining a reputation for being California’s cannabis cultivation mecca.

The California Growers Association was filed after that, but it never managed to get very far in court, but the argument was that allowing this loophole to continue directly conflicted with Proposition 64.

However, the end of the lawsuit seemed on the horizon when a new director took over the CGA. He was quoted soon thereafter as saying he was torn about the lawsuit’s prospects and purpose, saying he didn’t want to fight with marijuana farmers. The CGA board announced in a press release earlier this month that it had approved the director’s request to move for dismissal of the lawsuit.

The board consensus, as outlined in the statement, was that the burgeoning bud industry has robust regulatory oversight, many moving parts and is constantly evolving. The board and later its spokeswoman underscored their continued staunch belief that the agriculture department’s decision not to enforce provisions of Prop 64 failed to reflect voters’ intent  to provide small cannabis farms a running head start and chance to proliferate, the organization said it instead wanted to build relationships with new growers, not be at each other’s throats.

As Los Angeles marijuana business attorneys can explain, entering the cannabis cultivation market is not simple – or inexpensive – for those trying to do it right. An experienced marijuana attorney can help ensure you are abiding all state statutes and local ordinances.

The Los Angeles CANNABIS LAW Group represents growers, dispensaries, collectives, patients and those facing marijuana charges. Call us at 949-375-4734.

Additional Resources:

California marijuana growers association drops suit over loophole for mega-farms, Jan. 22, 2018, By John Schroyer, Marijuana Business Daily

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USPTO Patents to Pot Businesses Face Looming Challenges, Jan. 4, 2018, California Marijuana Farmer Attorney Blog