Jersey City cannabis applicant sues to overturn rejection

Local Modiv, a potential cannabis store, had their application denied last month

Local Modiv, seen in a June 2022 photo, are seeking to overturn their rejection via the courts. Photo by Mark Koosau.

A Jersey City cannabis applicant who was denied approval by the city’s cannabis board is suing them and the city to overturn their rejection, arguing that the board had applied “an incorrect standard” and had treated them differently than other applicants before the board.

Local Modiv, a potential retail cannabis applicant, filed a lawsuit in Hudson County Superior Court on July 27, listing the city’s Cannabis Control Board, which oversees cannabis applications, as well as the city of Jersey City as defendants.

The applicants, which includes CEO Chelesa Duffy, the Vice Chair of the city’s Women’s Advisory Board, and COO Matthew Cimiluca, an IT engineer, were looking to create a dispensary at 155 Newark Ave. at the site of the former Sleep Cheap store in the Downtown Newark Avenue Pedestrian Plaza.

They had received Planning Board approval back in March, one of the three requirements needed to gain full approval in the city, but were denied approval by the cannabis board after three hearings, essentially shutting them out from gaining full approval.

At the first meeting on June 13, Local Modiv had pitched themselves to the board, but were tabled after the commissioners questioned their location’s proximity to another applicant, Oceanfront Holdings (who were approved), as well has not showing proof of a relationship with the Historic Downtown Special Improvement District.

They were tabled a second time on June 27, but at their third hearing on July 11, they were ultimately denied approval, with the commissioners skeptical of their hiring priorities, as well as their company DNA.

Local Modiv were looking to create a dispensary at the former Sleep Cheap store in Downtown. Photo by Mark Koosau.

In Local Modiv’s lawsuit, filed by Justin Jacobs of Spector & Ehrenworth, P.C., the plaintiffs argue that their applicant “was more than sufficient to satisfy the standard that should’ve been applied by the [cannabis board].”

They point to Local Modiv’s application that had included Duffy’s volunteer work and community impact in Jersey City and beyond, as well as partnering with a Black woman’s hiring network and plans for job fairs in the city and northern New Jersey as part of their workforce plans.

When it came to their hearings before the cannabis board, they contend that the board’s decision to table them for the first time was because of factors that were beyond those in the city’s ordinance on whether an applicant for “local support” should be approved, such as whether other applicants were close by or having connections with the SID.

They continue that their “unfair treatment” occurred in the next meetings, including on June 27 where they argue that they were tabled based on “incorrect and false allegations”, and again on July 11, contending that the board ignored the SID issues and had instead asked questions that were “irrelevant” or already addressed.

Local Modiv is asking the courts to overturn the cannabis board’s denial and subsequentially order them to give the applicant approval.

“My client is looking forward to having their day in court, believe they are a strong applicant and that they met all the requirements to have a license” said Jacobs in an interview.

Cannabis Control Board attorney Ron Mondello declined to comment on any questions from the press. A Jersey City spokesperson did not respond for comment on the lawsuit.

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