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Court Backs Massachusetts Governor's Closure of Recreational Marijuana Dispensaries

By Eric Volkman – Updated Apr 17, 2020 at 5:58PM

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Gov. Charlie Baker did not include adult-use cannabis retailers on the state's list of "essential" business during the COVID-19 shutdown.

A court in Massachusetts has ruled that Gov. Charlie Baker acted within his authority when he made the decision to order the state's recreational marijuana retailers to close their doors during the COVID-19 shutdown of non-essential businesses.

Judge Kenneth Salinger's decision, handed down on Thursday, means that adult-use cannabis dispensaries will stay off Massachusetts' list of "essential businesses" allowed to operate during this stage of the SARS-CoV-2 coronavirus pandemic.

The matter landed in Suffolk Superior Court because last week a group of recreational dispensary operators and the associates sued the governor over the closure. They argued that the stoppage risks causing "irreparable" damage to their businesses, and requested that it be lifted.

Gavel with marijuana atop an American flag.

Image source: Getty Images.

Massachusetts' policy is unusual for a recreational-use state -- the majority of states where cannabis has been legalized for adults have designated all dispensaries to be essential businesses and allowed them to keep operating during the pandemic. Gov. Baker has said that his main concern is that if people from neighboring states travel to Massachusetts to buy recreational cannabis, that could increase the risk of people spreading the coronavirus.

Although recreational sales have been halted for the time being, the sale of medical marijuana is being permitted. And apparently, there has been a surge in applications for medical marijuana cards. 

"The governor's decision to treat medical marijuana facilities and liquor stores differently than adult-use [recreational] marijuana establishments has a rational basis and therefore is constitutional," Judge Salinger wrote in his ruling. 

One company that will be affected by the ongoing closure is Curaleaf Holdings (CURLF -0.40%), a marijuana company headquartered in the state. This impact might not be severe, however, as only two of the four dispensaries Curaleaf operates in the state sell strictly recreational product.

On Friday, Curaleaf Holdings' stock lagged behind the broader equities market, rising by 1.4%.

 

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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