How to Sue a City or County Over Cannabis

Our cannabis lawyers have recently been getting an increasing number of inquiries about how to sue cities and counties in both Washington and Oregon.

The Washington calls have been coming since Washington State Attorney General Bob Ferguson issued an opinion stating that Washington cities and counties can “opt out” from I-502. Our Oregon calls have been coming from cannabis stakeholders in counties (like Clackamas and Washington) and cities (like Tigard and Beaverton) that have issued or will soon issue temporary bans on cannabis.

 

Because Washington and Oregon laws are entirely different regarding the ability of a county or city to contradict state law legalizing cannabis, the ability to sue cities and counties in those two states varies. Unfortunately, for Oregonians, the legislature and Oregon Health Authority decided that cities and counties can ban medical marijuana for up to one year (until May 1, 2015). Nonetheless, Washingtonians still stand a chance under current laws. For that reason, I will focus on how to sue a Washington city or county for now, and deal with Oregon only if the laws there change in such a way as to make such a lawsuit viable.

This post is part I in a planned three part series on suing your city or county to overturn an adverse decision regarding your right to operate your cannabis business.  This first post addresses the basic tactics and law you need to know to pursue such a claim.

  • Determine applicable local ordinances. This can be a challenge as cities and counties are not always forthcoming with their current marijuana rules and also because it is not uncommon for them to frequently revise their rules. Nonetheless, you are going to need to read and understand the ordinance(s) being used to block your proposed cannabis activity and determine if it does in fact apply to you (for example, some cities and counties ban retail, but not production and processing).  If you cannot figure this out, call in legal counsel who can.
  • What’s the activity being blocked and what’s the basis for the prohibition? What issue does the relevant ordinance address? Is it land use? Zoning? Permitting? Business or safety licensing? Or some special scheme you must follow to open your doors? Knowing this will be your first step in figuring out the duties, obligations, liabilities, and rights available to you.
  • Determine whether you have standing to sue or appeal. You generally cannot sue unless you have standing to do so. Standing generally requires that you have been injured by an action of the city or county and you are entitled to a court remedy for that injury.  To have standing in an I-502 cannabis case in Washington, you need to show that: 1) you had some chance of obtaining a license from the State, 2) the relevant ordinance does not require you to do various other things (such as an administrative appeal) before going to court and 3) that you have been injured by having to comply with that ordinance.
  • What are your administrative stepping stones? Though it depends on the ordinance, in most instances, you will need to exhaust all of your available administrative remedies before you can sue a city or county in Washington State court. For example, Pierce County requires that its I-502 applicants not only be located in certain zones, but that they also apply for a Conditional Use Permit which the county has openly admitted it will not grant to anyone. This means that if you are planning to sue Pierce County, you can be sure that the County will seek to have your case thrown out unless your proposed cannabis business would have been in an area zoned for cannabis AND you applied for and were denied a Conditional Use Permit.
  • Be prepared to lose the first round. Most municipal and county administrative schemes require that you first appeal your license/permit denial to a hearing examiner (not a court). The hearing examiner will likely be an employee or an independent  contractor for the very same city or county against which you are pursuing your appeal. Ponder that for a moment and then just accept that your chances of prevailing at that level will just not be very good. In other words, you will need to commit to appealing the hearing examiner’s administrative decision to a real court.
  • File a well-written State Court complaint. If the hearing examiner rules against you, you will then need to pursue your complaint in the appropriate state court. The complaint that you file in the courts must comply with various Washington State and local court rules, and if your limited liability company or your corporation is going to be the plaintiff, the laws require that it be represented by a lawyer. Your complaint will need to do much more than just claim unfairness. It will need to set out in detail the unconstitutionality of the ordinance you are contesting or the procedures used to rule against you.
My law firm has rejected the idea of pursuing a class action against the various cities and counties that are objecting to cannabis applications because we are convinced that no court will grant the class action certification required to pursue such a case. Class actions must have a commonality of issues, but because the various local ordinances and decisions banning cannabis businesses are so varied (as is the individual forms of relief being sought), a class action simply is not feasible.
In Part II, we will address how to get internal documents from the city or county, how to negotiate with the city and/or county, and how to get a court to stop the city or county from moving forward with its marijuana ban.