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New York's Empire Cannabis Club gets raided

It'll be a dogfight for the future of New York's legal cannabis market. Plus, a big new study into the public health impacts of legalization in Canada, and more.

Hi everyone,

We’re back! Hope you all had some well-deserved time off over the Fourth. I certainly did.

It’s nice to unplug for a bit, but the cannabis industry moves at a head-spinning pace: There’s far too much to cover in one newsletter, so I’ll have another edition on Friday morning.

This edition will be focused more on policy news. I’ll have everything you might’ve missed over the holiday on the markets and finance side on Friday.

If it’s your first time reading, I’m Jeremy and I’ve covered cannabis for quite a while.

I’ve got a long track record of breaking stories about the people, companies, and policies that matter.

I want this newsletter to be your guide to the brave new frontier of cannabis, whether you’re already in the industry or are looking for your opportunity.

I want to inform you on the news you can use, cut through the bullshit, and hopefully give you something fascinating to read.

All that’s to say I’ve seen a thing or two, and I’ve heard even more — and like any good reporter, I’m terrible at keeping secrets.

You’ll be the first to know when I have something good to share.


Today’s Cultivated is sponsored by the PBC Conference.

PBC Conference is the preeminent payments, banking, and compliance conference for the cannabis industry, held in the heart of Washington DC at the Capital Hilton.

PBC brings together lawmakers, top cannabis regulators, and executives at the biggest cannabis companies to chart the future of the industry.

That’s not PR-speak, I mean it: Last year I spoke at PBC, and even broke some news from the conference floor.

September 21-22 will be the fourth iteration of the conference.

There will be keynotes from Rep. Earl Blumenauer — a longtime champion of cannabis reform in Congress — as well as Jim Cole. You’ll also hear from the head regulators of New York, Illinois, Massachusetts, California, and Oklahoma, among other stellar panelists.

I’ll also be speaking again, and I hope to see you all there!

a cannabis shop sign hanging from the side of a building

💡What’s the big deal?

What happened: Two locations of the Empire Cannabis Club — one of the largest and most high profile of the unlicensed cannabis shops in New York City — were raided on Tuesday as part of the state’s ramped-up enforcement efforts.

Reports of the raid started filtering in on Twitter yesterday afternoon. By evening, there were multiple confirmed news reports.

Police pushed their way past Chelsea store manager Jonathan Elfand in order to conduct the raid. On the Lower East Side, police ordered Elfand’s sister, Lenore, to appear before court on obstruction charges but did not enter the shop, reports The New York Times.

Why it matters: Empire’s operators have been some of the most outspoken about what they see as loopholes in New York’s cannabis laws that lets them operate without a legitimate license.

It was probably only a matter of time before they got slapped down. Still, they remain undeterred. The Eight Avenue location was up-and-running shortly after the hours-long standoff with police and tax agents.

Empire’s lawyer, Steve Zissou1 resolved to fight.

“Empire didn’t get started yesterday – they’ve been involved openly, notoriously, they weren’t hiding from anybody. They would speak to anyone. I’ve called OCM many times,” he told NY Cannabis Insider’s Brad Racino.

Zoom out: Everyone interested in the future of New York’s cannabis industry will be watching what happens next.

Empire bills itself as a “membership service” rather than a traditional cannabis shop. That’s the basis it’s used to operate five locations citywide with impunity, so far.

While that distinction may or may not win the day in court, the cannabis chain has become one of the most popular retailers in the city. Clearly, regulators are trying to send a message by targeting Empire.

My prediction? It’ll be a dogfight.

🗣️ Quote of the week

“We certainly do not model for federal legalization… From a balance sheet perspective, you need to act like it’s not going to happen.”

This comes from Jason Wild, chair of the recently TSX-listed cannabis company TerrAscend and president of the $600 million cannabis fund JW Asset Management.

🥊 Quick hits

Maryland kicked off legal cannabis sales on July 1.

Germany unveiled its draft plan to legalize cannabis.

The Scottish government wants to legalize all drugs.

Democratic candidate and political scion Robert F. Kennedy Jr. said he’ll legalize cannabis and psychedelics if he gets elected.

  • He also wants to use the tax revenue to create agricultural healing centers for those suffering from addiction.

Florida Rep. Matt Gaetz wants to end cannabis testing for the military.

🧪 Science & research

What happened: A new study about the public health impacts of cannabis legalization in Canada found that, get this: There were some good things and some bad things associated with legalization.

The study’s authors pored over research published about Canada’s recreational and medical cannabis programs between 2006 and 2021 to generate a broad meta-analysis about how legalization affects both adult and teen use, mental health, alcohol use, and other public health impacts.

Here’s what they found:

  • Cannabis-related arrests in Canada decreased following legalization in Canada.

  • Cannabis prices decreased.

  • Cannabis use increased modestly among young adults, and the proportion of adults who purchase cannabis legally has steadily increased since legalization.

  • Cannabis use did not increase among high-school aged kids, nor did the prevalence of daily and near-daily use among kids. It didn’t decrease, either.

  • There’s conflicting evidence about whether cannabis legalization caused an uptick in driving accidents.

  • Hospital visits associated with cannabis use — including vomiting, and psychiatric episodes — increased.

Zoom out: Advocates on both sides of the legalization debate often spew dire warnings about what will happen if they don’t get their way.

But research about the impact of full-scale federal legalization has been scant so far. Canada has so far been the only test case, as the only major world economy to federally legalize cannabis.

Now, we have some measure of truth to generate future policy.

While there are lots of opinions about hot-button issues like teen use, the researchers mostly found that hard, statistical evidence one way or another is more difficult to come by.

Consider that your warning when you read breathless tweets and op-eds about how legalization can save the world, or that it’ll doom us all. As with most things, the facts lie somewhere in the middle.

❓Today in WTF

The DEA wants “fellow kids” to eschew drugs for the joys of Instagram and video games. Alright, then.

👩 People moves

Ellen Deutsch will take over as CEO of embattled cannabis retailer MedMen. It’s the company’s fifth CEO in three years.

Julie K. Johnson is now the Chief of Research at the Massachusetts Cannabis Control Commission.

📚 What I’m reading