Cannabis Q & A: What is the statute of limitations and how does it affect cannabis companies?

June 15, 2021

Jennifer Gumer Partner Headshot

Welcome to our Q&A with partner, Jennifer Gumer!

As a partner at CGL and our Regulatory and Compliance Practice Lead, Jennifer provides strategic counseling, practical advice, and expert advocacy to clients with production needs. As an Adjunct Professor of Law and Bioethics, she is uniquely qualified to handle all interactions with federal, state, and local regulators who oversee product development, manufacturing, and marketing activities, including the FDA and Local Hemp Regulators.

Q: What is the statute of limitations and how does it affect cannabis companies?  

The statute of limitations restricts the length of time a party has to bring a legal claim. We saw it in action recently in the cannabis sphere, where Elevations Plus failed to bring an action in time to contest its rejected cannabis retail permit.  

In this case, the City of Riverbank (the City) rejected the application submitted by Elevations Plus after a more than two year wait period and the unanimous vote by the City to recommend approval of the application. The rejection was based on concerns the City had about the sustainability of another cannabis retailer in the area.  

However, four months later, the City approved a conditional use permit for a significantly larger cannabis retailer. A month following this approval, Elevations Plus sued the City. The basis of their claim centered around the unjust denial of Elevations Plus’ application. While the argument seems compelling, it failed because of a 90-day statute of limitations.  

The California Government Code s 65009 states 

“…, no action or proceeding shall be maintained in any of the following cases by any person unless the action or proceeding is commenced and service is made on the legislative body within 90 days after the legislative body’s decision…:.  

Since Elevations Plus commenced their action against the city more than five months later, their suit failed.  

The key takeaway here is to seek legal advice immediately upon receiving an adverse decision about your application. You should ascertain when any claim would need to be commenced by you so you don’t miss crucial deadlines.  

Disclaimer

The materials available at this website are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this website or any of the e-mail links contained within the site do not create an attorney-client relationship between CGL and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

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