Lawsuit Over Equity Plan Sees Cambridge, MA Pause All New Cannabis Businesses

The city of Cambridge, Massachusetts is effectively stopping all new cannabis businesses from opening. This temporary order is in response to a lawsuit opposing the city’s plan to prioritize disadvantaged individuals when awarding recreational cannabis business licences. A court ruled against Cambridge in the case last month; the city has responded by seeking an appeal.

“Any interested party can apply to enter into a host community agreement with the city,” said a city memo on February 14. “However, initially the city will not enter into any agreements while the city awaits further action by either the Superior Court or the Appeals Court on the above referenced appeal and related pleadings.”

Massachusetts state regulations require cannabis businesses to sign host community agreements with cities before they begin operation. Citizens voted to legalize adult-use marijuana in November 2016 and the first recreational dispensaries opened in fall 2018. As yet, Cambridge has no recreational dispensaries.

In September 2019, the Cambridge City Council passed a first-in-the-nation equity ordinance that imposed a two-year moratorium on most new cannabis dispensary (retail) licenses. Under the ordinance, only participants in the state’s Economic Empowerment program would be eligible to receive licenses during that two-year period. Program participants are recognized by the state as promoting business practices that empower communities disproportionately impacted by marijuana prohibition.

The ordinance was intended by the council to help disadvantaged groups of people benefit initially from the opportunities created by legalization. After the two-year moratorium, the licensing process was due to open up to other business owners, including medical marijuana companies that have been operating for years.

But some medical marijuana companies opposed the ordinance, believing it unfair for the city to initially exclude them when giving out recreational licenses. In October 2019, Revolutionary Clinics, a medical marijuana company, sued the city. It claimed that the equity ordinance would caused “irreparable harm [through] substantial financial losses that are inevitable due to the two-year delay”.

A Superior Court judge ruled in favor of Revolutionary Clinics in January, and issued a preliminary injunction that barred the city from enforcing the ordinance or excluding any companies from applying for a dispensary license. The city is now appealing the ruling, and halting the issue any new cannabis business licenses in the interim.

Massachusetts has struggled to create cannabis business ownership for Black, Brown and other communities most impacted by marijuana prohibition. In particular, the requirement that businesses sign host community agreements with city governments has challenged many entrepreneurs who don’t have the resources or political connections to achieve this.

Pure Oasis, the first recreational dispensary to be licensed in neighboring Boston, was assisted by the state’s Economic Empowerment program. Expected to open soon, it will be the first Black-owned dispensary in the city.


Photo of Central Square in Cambridge, MA by Eric Kilby via WikiMedia Commons/Creative Commons 2.0.

Alexander Lekhtman

Alexander is an editorial fellow at Filter.

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