The California Bureau of Cannabis Control has ordered online cannabusiness listing giant Weedmaps to take down advertisements for companies in the state that do not have valid licenses.
In a letter to Ghost Management Group (owner of Weedmaps) CEO Doug Francis dated Feb. 16th, the Bureau said that Weedmaps.com “must immediately cease all activity that violates state cannabis laws.” The letter goes on to say that because a cannabis business in California needs “a valid state license from a state licensing authority…to legally operate a commercial cannabis business within the state of California,” Weedmaps must remove all listings for businesses that don’t have such a license. The CBCC claims that Weedmaps is “aiding and abetting in violations of state law” by having the advertisements on their site.
The owners of Weedmaps have responded, saying that since the website is not licensed by the state of California, the CBCC has no jurisdiction of what businesses are listed on their site, whether those businesses have a license or not. Weedmaps also claims that since the company is an “interactive computer service” that is covered under the federal Communications Decency Act, they shall not be treated as the publisher of information provided by a third party under that law.
Weedmaps response letter to the CBCC also states that “any groups that place information on our site represent and warrant that they are in compliance with local law,” meaning it is up to the individual companies to make sure they are licensed and regulatory compliant in the state(s) they operate in.
The response letter from Weedmaps also goes into great detail about the trouble many businesses are having getting the licenses they need in California due to high taxes and restrictions, as well as the fact that some “85% of California cities and counties do not permit licensure for cannabis business operators.”
This is shaping up to be a battle that could drag on for quite a while, likely being resolved in the court system. Weedmaps has a lot of incentive to keep unlicensed businesses listed on their site since they account for a substantial amount of the revenue that WM generates.
The process of cracking down on unlicensed marijuana businesses in California is well under way as state authorities try to clear the market for legally-regulated companies. It will be a long process, one that will be littered with battles along the way.