Growing pains in the marijuana products industry

What the future holds for marijuana retailers, distributors and manufacturers

It’s been interesting to watch public, medical and legal opinions evolve on the pros and cons of marijuana use over the years since the days of Reefer Madness. It’s likely that future generations will look back in bewilderment at the social struggles over legalization just as we do now at the alcohol prohibition movement of the1920s and 1930s.

No matter which side of the legalizations debate you’re on, the tide is turning. At the time of this writing, the use, cultivation and distribution of marijuana is legal in four states and the District of Columbia. Dozens more have medical marijuana laws on the books and even more have decriminalized the use and possession of cannabis to some extent. Needless to say, the marijuana industry in the U.S. is booming.

And with that, as in all industries, product safety and business practices comes into question. Too often this results in lawsuits being filed, which has already begun in the marijuana industry. But the growth rate of the marijuana industry leaves state legislators and regulators struggling with how to apply current laws or write new laws.

Below are a few examples of legal issues we’ll likely be hearing about in the not-too-distant future within the industry.

  • Breach of Contract

Retailers contract with manufacturers in good faith and therefore assume the products they purchase are safe. But suppose harmful pesticides or chemical fertilizers were applied during the growing process but that information isn’t disclosed. Product liability comes into play if a consumer becomes ill from ingesting or inhaling the chemicals, giving the retailer an opportunity to allege breach of contract.

  • Failure to Warn

As cigarette manufacturers learned the hard way, they had an obligation to warn consumers of the health risks associated with smoking. The research within the medical community has yet to determine whether there are any physical or mental health risks associated with marijuana. This is being argued in the first edibles-related wrongful death lawsuit.

  • Negligence

Since there are no federal laws or regulations with regard to marijuana product labels, should manufacturers and distributors have to conduct product tests or use focus groups to determine potential risks associated with their products? How can the industry responsibly regulate itself without FDA oversight?

  • Age Restrictions

The states with marijuana laws have age restrictions with regard to use and sales to minors. However, consumers can make claims of being enticed by advertising that appeals to young people or is packaged or manufactured in a way that attracts their attention, such as packing with cartoon character logos or pot-infused suckers, candies and cookies.

These examples are just the tip of the iceberg of future allegations, claims and lawsuits. Players in the industry can expect more laws and regulations, particularly as relates to the products themselves, as well as continued lack of continuity across state lines because of the lack of federal laws pertaining to the industry.

Source: Tammy Meyer. “Recent Drug Litigation—Marijuana Products,” 17 June, 2016.
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