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Washington State Limitations on Early Stage Cannabis Business

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Submitted by Marijuana News on Sun, 03/01/2015 - 12:18

A couple of recent events have us thinking about the different ways retailers and cultivators are doing business in the cannabis market. First, a few of our clients have asked us about situations involving groups of retailers banding together to negotiate with producers and vice versa ­— groups of producers teaming up to negotiate prices and supply contracts with retailers. Then, Washington’s Liquor Control Board released emergency rules that, among other things, severely limited the ability of Washington marijuana businesses to enter into standard sales agreements. How are these things connected?

Let’s examine the guild-like behavior of certain businesses. A group of producers, like six or seven, approach a retailer as a group. They negotiate a standard sales agreement where the retailer buys a few pounds per month for a few months from their producer group. The producer group does not specify responsibility for delivery; it just guarantees that at least one of them will...

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http://www.cannalawblog.com/state-limitations-on-early-stage-cannabis-business-as-antitrust-rears-its-ugly-head

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