Cannabis Law Blog

News & Insights for Cannabis Law and Business

Alternative dispute resolution (“ADR”) – such as mediation and arbitration  – has long been an attractive alternative to litigating disputes in court, especially for parties hoping to arrive at a swift resolution.  Now, given the unprecedented backlog in California courts caused by the COVID-19 pandemic, as well as uncertainty related to re-initiation of jury trials, ADR may become an increasingly favorable option – particularly for those in the cannabis industry.  According to the 2019 Annual…
It would be an understatement to say that the COVID-19 pandemic impacted transactional activity for buyers and sellers across a range of industries, the hemp and cannabis merger and acquisition (“M&A”) space being no exception.  In particular, the current period of COVID-19 volatility in the hemp and cannabis space is marked by numerous consequential outcomes, namely: (1) a sharp decline in the number of deals; (2) decline in capital raises; and (3) overall decline in…
As the novel coronavirus (COVID or COVID-19) continues to ravage the United States, the cannabis industry is feeling the pandemic’s negative impacts despite an initial spike in sales after cannabis operations were deemed essential under various state “stay-at-home” orders.[1]  This article details the most recent state-level responses activated in California and Illinois. California One month after California Governor Gavin Newsom’s proposed budget[2] predicted that California’s legal cannabis industry will face declining sales due…
This article originally appeared in Cannabis Business Executive​ on June 10, 2020. Claimed “illegality” of cannabusinesses continues to be a critical issue for them in their ability to enforce their rights in the courts. The ability to seek judicial relief may be especially important to some cannabusinesses that are struggling as a result of the COVID-19 pandemic (e.g., to seek bankruptcy relief, or to obtain compensation from customers or suppliers that breach contracts). In our…
Many Illinois cannabis contracts, including intellectual property licensing agreements, development agreements and supply agreements, contain force majeure clauses.  Depending upon the language of these clauses, the COVID-19 pandemic may be an event that triggers these clauses and provides a defense to nonperformance of the contract. Companies that are experiencing difficulties complying with or enforcing compliance with their contracts should carefully examine their contracts to determine if a force majeure clause may excuse performance. On March…
In an effort to stem the tide of COVID-19 transmission, many state and local governments have enacted “shelter-in-place” or “stay-at-home” orders to protect the health and well-being of citizens, and to establish a consistent approach to slow the spread of COVID-19.  Many of these orders identify certain services as essential, including food, prescriptions and healthcare, that can continue to operate despite the “stay-at-home” order.  In many jurisdictions, cannabis dispensaries have been labeled “essential” businesses, and…
As with essentially all aspects of American life, COVID-19 threatens to be a massive disrupter in the cannabis industry. As most cannabis operators and ancillary services providers are well aware, securing cannabis-related investments in the pre-COVID-19 world presented substantial obstacles. With worldwide markets dropping and investors drawing on their purse strings, the cannabis industry will likely feel a tighter pinch on access to investment dollars. Alternatively put, the already-tight outlook for capital in the cannabis…