Common contract issues in the cannabis industry include vague licensing terms, unclear intellectual property ownership, and failure to address regulatory compliance. Beyond general business disputes, the cannabis industry faces unique litigation risks tied to its regulated nature and specific product offerings. These risks can catch businesses off guard, leading to costly legal battles that could have been avoided with proper planning. For example, Delaware Gov. John Carney recently signed a bill protecting financial institutions and other service providers working with cannabis businesses from state-level prosecution.
- Following Trump’s lead, White House officials and Republicans in Congress used news show appearances to demand that Zelenskyy display more gratitude for U.S. support and an openness to potential war-ending concessions to Russian President Vladimir Putin.
- COLUMBUS, Ohio (WCMH) — As Ohio legislators look to crack down on voter-approved recreational marijuana laws, cannabis industry leaders are asking them to reconsider.
- Out-of-period adjustments reflect adjustments to net loss for the financial impact of transactions recorded in the current period that relate to prior periods.
- As such, most cannabis businesses are forced to run much like off-book operations, counting stacks of cash and struggling to access basic bank accounts.
- Cannabis companies, it seems, tend to be more litigious than businesses in other industries.
- Foods fortified with CBD derived from hemp cover an extensive range of products, including nutritional powders, supplements, protein & nutrition bars, beverages, breakfast cereals, dairy & dairy alternative products, bakery items & snacks, animal feed, and pet food.
Proactive Legal Strategies for the Cannabis Industry
Outdoor cannabis cultivation is typically less expensive than other farming techniques because the natural environment provides the necessary elements for the plants to flourish. Consequently, there’s an increase in outdoor farming operations since this method eliminates the need for costly cultivation equipment and reduces total operational costs, thus propelling market growth. The industry is booming due to the increasing adoption of cannabis for medical and recreational use.
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Medicinal cannabis use was reported to improve quality of life and reduce unwanted medication use by many of the study participants. The present findings indicate that medicinal cannabis can potentially play a harm-reduction role, helping veterans to use fewer pharmaceutical medications and other substances. The increase in net revenue1 of $23.1 million was primarily due to higher sales to Australia, Germany, Poland, and the UK, as well as increased revenue in Canada to insurance covered and self-paying patients. With the Farm Bill reauthorization pending, there’s significant uncertainty around the future of hemp-derived cannabinoids. This includes the legal status of intoxicating hemp-derived THC edibles that have flooded convenience stores and gas stations nationwide.
Cannabis prices are still compressing, and brands are consolidating
The study, conducted by research firm Whitney Economics with support from cannabis credit agency CTrust and fintech firm Green Check, projects that the cannabis industry could add 25,000 to 30,000 new business licenses to the existing 40,000 licenses over the next 12 years. The U.S. cannabis industry is poised for massive expansion over the next decade, which will require big money – as $130.7 billion – to fund it, according to a new industry report. But absent federal banking legislation and greater institutional involvement, the odds a sustainable Law Firm Accounts Receivable Management source of capital panning out are slim. With your systems running smoothly and your team well-trained, you’ve built a financial infrastructure that can withstand scrutiny and support growth. Let’s wrap up with key takeaways and action steps to ensure your business stays ahead of the curve. Getting your Cannabis books in order isn’t just about reconciling accounts – it’s about building a financial foundation that can withstand both regulatory scrutiny and support strategic growth.
This may be due to the competitive nature of the market, the high stakes involved, or a combination of factors. Combine this tendency with unclear contracts and tough-minded business owners, and you have a recipe for cases that don’t settle easily, resulting in more trials than in most other industries. The journey to clean books and proper financial controls isn’t easy, but it’s essential for survival and success in the Cannabis industry. As we approach the historic rescheduling of Cannabis to Schedule III, businesses that have done this foundational work will be positioned to thrive, while others may struggle to catch up. With your engagement letter signed and scope clearly defined, the next crucial step is establishing a sustainable and clear fee structure.
Expect to see continued adoption and growth of cannabis debit payments throughout 2024. Flowhub data from Green Wednesday 2023 found dispensaries accepting debit cards earned an average of $4,627 more per day than cash only retailers. According to the cannabis accounting MJBizFactbook, for every $10 consumers and patients spend at dispensaries, an additional $18 will be injected into the economy. Similarly, around 25% of the 50 best-selling flower strains in both California and Colorado come from a single brand. This shows just how competitive (and compressed) the brand landscape is becoming. Competitive pricing trends among cannabis brands and retailers have led to significant price declines beginning in 2021.
More than 1 in 3 American women consume cannabis
Some cannabis lawsuits are based on weak legal arguments or are driven by personal animosity rather than legitimate business disputes. Judges have little patience for such cases, which waste valuable court time and resources. One judge even told one of our cannabis litigation attorneys that cannabis companies should be using arbitration a lot more often. Judges are frustrated, businesses are losing money, and lawsuits that should never have been filed are clogging up the courts.
Junior – Canadian Dollar Reporting
One of our experienced cannabis litigation attorneys can objectively analyze your case—before you invest valuable time and resources into a lawsuit that may not pay off. Cannabis businesses must comply with a complex web of federal, state, and local regulations. Violations of these regulations can lead to enforcement actions by regulatory agencies, including fines, license suspensions, or even criminal charges. These actions can be costly and disruptive, what are retained earnings even if the business is ultimately cleared of wrongdoing.
Obtain appropriate insurance coverage to protect your business against potential liabilities, such as product liability claims or property damage. Some judges lack a deep understanding of the unique challenges and complexities of the cannabis industry. This can lead to rulings that are not well-tailored to the specific circumstances of the case. Instead of rushing into costly litigation, we helped our client negotiate a settlement with the supplier.