New York Cannabis: Notable CAURD Application Attestations
Any breach of these attestations may result in the revocation of the CAURD license
During the submission of the Conditional Adult Use Retail Dispensary (“CAURD”) application, applicants are required to submit and certify several attestations prior to final submission of an application. These attestations must be sworn to and initialed by the applicant (if an individual), a managing member of the applicant (if a limited liability company), an officer of the applicant (if a corporation), or all partners of the applicant (if a partnership).
Some of the attestations are run of the mill (e.g., that the applicant will not sell cannabis to persons under 21 years of age and will submit to the jurisdiction of the courts of New York State). However, there are several notable attestations that may influence: 1) an applicant’s decision on completing their application for a CAURD License and 2) how the applicant will run their business if awarded a CAURD License. Any breach of these attestations may result in the revocation of the CAURD license. A breach may also prevent the ability of the entity or any listed owners to be granted any adult-use cannabis license in the future.
Attestation # 1 – The applicant agrees to accept the location of a dispensary should one be assigned to the applicant by the State.
Attestation # 2 – The applicant agrees not to lease, transfer, or subcontract either a portion or the whole licensed premises.
- Attestation # 1 and Attestation # 2 are crucial points for CAURD applicants to consider, especially when ranking their regions for their potential dispensary. Based upon those Attestations, any applicant who is granted a CAURD License must accept the location and region of the dispensary and cannot lease or transfer that space in the event that the dispensary’s location is untenable or undesirable.
Attestation # 3 – The applicant agrees to commence operation no later than 12 months from the date the license was granted.
- Although it would be in the CAURD License holders’ best interest to open their dispensary as soon as commercially feasible, this is a noteworthy Attestation given the mere fact that applicants cannot choose the location of their dispensary, but only rank their top five (5) regions. If an applicant is granted a CAURD License far from where they currently live and/or operate a business, this Attestation requires applicants to be ready to move their other business(es) and uproot their lives and families if the CAURD location is too far to commute to on a regular basis (i.e., living in Brooklyn and being awarded a license in Western New York).
Attestation # 4 – The applicant and true parties of interest agree to limit their financial or controlling interests to no more than three conditional adult-use retail dispensary licenses issued.
Attestation # 5 – The applicant and any true parties of interest agree to only use their license for an adult-use retail dispensary, and shall not hold any interest in any license authorized for the cultivation, processing, or distribution of adult-use cannabis, or a licensed or permitted testing laboratory.
- Attestation # 4 and Attestation # 5 are relatively straight-forward but important for any CAURD applicant to know prior to submitting their application. In short, a CAURD applicant may only be a party to three (3) CAURD Licenses and must only have an interest in a dispensary, and not any other aspect of the marijuana business or cultivation. If the Office of Cannabis Management ( “OCM”) becomes aware of an applicant’s interest in more than three (3) CAURD Licenses or business interest in a cultivator or testing lab, said applicant may have all their CAURD Licenses revoked and be barred from applying for any other type of adult-use cannabis license in the future.
The OCM has begun accepting applications for CAURD Licenses on August 25, 2022 and we strongly recommend contacting an experienced New York cannabis attorney (including us!) prior to completing your application.
For more on CAURD, check out the following posts:
- New York CAURD Application Portal FAQ
- New York’s Conditional Adult Use Dispensary License
- New York CAURD: License Application Scoring — Part 1
- New York CAURD: License Application Scoring and Selection — Part 2
- Hire a New York Cannabis Attorney
Source: Canna Law Blog
