Law Firm Urges Weedmaps to Set Date for Promised Crackdown on Unlicensed Retailers

A law firm representing several clients in the cannabis industry is urging Weedmaps to set a date for its promised crackdown on unlicensed retailers advertising on the website. Attorneys with the firm Zuber Lawler said in a press release on Thursday that the move by Weedmaps will help support California’s legal cannabis industry and deal a blow to unlicensed operators.

“The decision by Weedmaps to cease carrying ads for unlicensed cannabis businesses is a critical step for wiping out the black market industry that undercuts legal retailers that play by the rules,” said Manny Medrano, a Zuber Lawler litigation partner. “It’s important to closely monitor this situation because despite Weedmaps’ announcement, the company provides no exact date for making the promised changes.”

On Wednesday, Weedmaps announced that “beginning later this year” it will require retail advertisers in the U.S. to provide a state license number on their listings on the cannabis information platform. Weedmaps CEO Chris Beals said in a press release that will help both consumers and legal cannabis businesses.

“These enhancements to existing safeguards on our platform will help patients and adult-use consumers find cannabis retailers that have provided evidence of state licensure,” Beals said. “It also underscores our commitment to working with lawmakers and regulators to foster a flourishing legal market.”

Weedmaps Dodges Lawsuit

The announcement from Weedmaps followed months of complaints from licensed cannabis businesses that they were being harmed by Weedmaps’ inclusion of ads for unlicensed companies. In California, the Bureau of Cannabis Control issued a cease and desist letter to Weedmaps over its ads for unlicensed retailers in February 2018. The following month, Weedmaps replied that it would not comply with the order, citing protections under federal law.

Attorneys with Zuber Lawler say that they were on the verge of filing a class-action lawsuit against Weedmaps when the company announced it would stop carrying ads for unlicensed cannabis business. The suit on behalf of licensed cannabis businesses would have sought injunctive relief against Weedmaps under Calfornia’s Unfair Competition Law, which prohibits false advertising and illegal business practices, “in this case the advertising of unlicensed cannabis products through Weedmaps’ various digital channels.”

Scott Benson, the CEO of Apex Extractions, a licensed cannabis concentrates manufacturer, told High Times in an email that the decision by Weedmaps is a positive development for the industry.

“We are thrilled to see that Weedmaps is putting their support behind cannabis entrepreneurs who adhere to important industry laws on a daily basis,” said Benson. “This is a long-overdue move for Weedmaps and we hope that other companies will follow suit because it will benefit everyone in the legal cannabis ecosystem.”

Weedmaps to Support Social Equity Entrepreneurs

Weedmaps also announced on Wednesday that it was launching a program to help social equity entrepreneurs apply for and secure licenses to operate in the legal cannabis industry. The program will provide minority business owners, who often face challenges securing licensing and capital, tools to help them navigate the regulatory process.

“For too long, unjust laws and regulations have crippled small-business owners who want to make an honest living and provide safe, legal cannabis products to medical patients and adult use consumers,” said Beals. “We hope to give a leg up to entrepreneurs that need and deserve support.”