By Darren Smith, Weekend Contributor
We have previously described events happening at city hall in Wenatchee, Washington regarding the city exercising control over the marijuana business legalized in the state. HERE and HERE The Washington State Liquor Control Board sold the licensing rights to Wenatchee to SMP Retail, LLC. The city then prohibited the business from opening its doors despite having progressed through the build-out of the business as required by the Liquor Control Board to complete the operating permit. The city council claimed it did not want to grant business licenses to those that “violated federal laws”. Despite the assurances proffered by the U.S. Justice Department that the federal government would not prosecute state licensed marijuana businesses, the city held fast and elicited the lawsuit. SMP Retail sued the City of Wenatchee in Chelan County Superior Court.
It seemed likely in a subsequent council meeting the city would reverse course on its ban as it had previously directed the city attorney to draft an ordinance removing the federal compliance requirement and allow by default the state licensed marijuana businesses to set up shop. Now it is back to prohibition.
The city council voted to impose a six month moratorium on allowing licensed retailers from operating legally within the city. The council also tabled indefinitely a proposal to amend its business license law to no longer require businesses to comply with federal laws. The amendment — proposed two weeks ago by Councilwoman Karen Rutherford — would have allowed marijuana businesses within the city.
Councilman Bryan Campbell said: “We really need to vet out all the different issues. I don’t want to go in one direction without enough knowledge and realize that we made a mistake.”
City Attorney Steve Smith commented: “We really, as a city, haven’t spent any time formally developing regulations or reviewing our regulations. The reason you do a moratorium … is so that you can buy yourself some time to study that and not have to deal with applications in the interim.”
One could retort the city had time since the fall of last year when it legislated state licensed marijuana businesses out of the city, but it in all likelihood changed its approach when it found itself sued in Superior Court over the matter.
Coincidentally, during the same council meeting, the city attorney announced a settlement with Global Entertainment of Arizona over the Town Toyota stadium debacle that came distressingly close to bankrupting the city. The settlement amounted to a million dollars of which after legal costs the city would split five hundred and ninety thousand with the Greater Wenatchee Regional Events Center Public Facilities District, which owns the arena.
One has to wonder if any of the money from the proceeds from the stadium lawsuit or the fact the law firm of the City Attorney proffered it would represent the city free of charge had anything to do with swaying the council to impose the marijuana moratorium.
As mentioned in a previous article the American Civil Liberties Union agreed to assist in the case on the side of marijuana retailer SMP Retail against the city, vowing to take the issue to the Supreme Court. How “free” of cost by the law firm’s offer this will represent to the city if the case goes that far hopefully will be factored in for future retainer costs.
The state already restrains marijuana retailers by significant regulation as to location and other issues the city could adopt by reference. But, instead, a few words of an ordinance must be maintained guaranteeing a lawsuit against the city that someone is going to have to pay for. And, that it could ultimately lose along with tax revenue and distractions from other important issues.
Yet, during the council meeting an amount of irony surely could have been recognized between the past stadium lawsuit and the present marijuana one; as Councilman Jim Bailey expressed: “Originally, we just wanted to be done with all this. [The Stadium Debacle] But on second thought, we saw an opportunity that there might be a few dollars out there. We were able to do that without costing us an arm and a leg. I think we have covered our due diligence in looking after taxpayer dollars.”
All cities in Chelan County: Wenatchee; Cashmere; Leavenworth; and Chelan, have either banned legal and licensed marijuana retailers or imposed prohibition by moratorium. Consumers now must travel to other counties it seems to buy legal weed or perhaps continue to purchase it from the alley behind a tavern or from a salesman with the South Side Locos, or the Colonia Chiques franchisees of Mara Salvatrucha.
It seems issuing a business permit to a state licensed retailer presents too many problems for the City Council of Wenatchee.
By Darren Smith
Sources:
Wenatchee World
City of Wenatchee
The views expressed in this posting are the author’s alone and not those of the blog, the host, or other weekend bloggers. As an open forum, weekend bloggers post independently without pre-approval or review. Content and any displays or art are solely their decision and responsibility.
SierraRose
So why …
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This case confuses you?
So why is the column I received an email announcement of entitled, ““So Sue Me”: President Taunts and Constitutional Consequences” not available when you follow the link? Why has this been taken down?
City of Seattle v. Blume, 134 Wn.2d 243, 947 P.2d 223 (1997).
“A city sought to collect unpaid interest from private developers who had executed a loan agreement with the city to obtain community development block grant funds administered by the city to help finance their proposed development. Five years and four months after the developers had applied for a master use permit to build the proposed development, and after they had expended more than $1 million on the proposal and permitting process, the developers withdrew their application for the master use permit. The developers counterclaimed for damages for the city’s (1) arbitrary and capricious delay in the permitting process and (2) intentional interference with their business expectancy.
The Superior Court for King County … entered a summary judgment dismissing the developers’counterclaims. The court ruled that the developers’ decision to withdraw their application precluded the tortious interference claim and that the delay claim was time barred.
The court affirmed the judgment by an unpublished opinion noted at 82 Wn. App. 1011 (1996).
Washington Supreme Court: Holding that the developers’ tortious interference claim was subject to a statutory time limitation of three years and was not time barred, that the developers’ withdrawal from the permitting process did not necessarily preclude the tortious interference claim under the “independent business judgment rule,” and that the proximate cause element of the tortious interference claim remained unresolved, the court reverses the decision of the Court of Appeals and the judgment and remands the case to the trial court for further proceedings.”
It appears that Wenatchee and city officials can be sued for damages in addition to the injunctive relief, for tortuous interference.
Under Washington tort law, could SMP sue Wenatchee for tortious interference with prospective economic advantage?
To establish a claim for tortious interference with prospective economic advantage, a plaintiff must demonstrate: “(1) that plaintiff had a reasonable expectation of an economic benefit or advantage; (2) that defendant knew of plaintiff’s expectancy; (3) that defendant wrongfully and intentionally interfered with this expectancy; (4) a reasonable probability that but for defendant’s wrongful interference, plaintiff would have realized the economic benefit; and (5) that plaintiff was injured as a result of defendant’s conduct.”
The text of Restatement (Second) of Torts § 766B (1979) states:
Could SMP add damages claims based on this tort?
Let’s take a look at the complaint, which is what the court will look at (not the ill-advised chattering on this thread):
SMP Retail v Wenatchee (Case # 14-2-00555-0).
1. SMP Retail, LLC brings this suit to halt Defendant’s prohibition of marijuana businesses in the city of Wenatchee. Defendant’s city council has stated that Defendant will not grant city business licenses to State-licensed marijuana businesses seeking to locate in the municipality, citing federal prohibition.
2. Defendant has further objected to Plaintiff’s application to the Washington State Liquor Control Board (the “Board”) for a retail marijuana license.
3. Defendant’s actions conflict with and are preempted by State law, exceed regulatory authority granted by Washington State Initiative Measure No. 502 (“Initiative 502”), and are unconstitutional.
…
The city was not satisfied to merely violate the law by denying a city license, no, they went even further to interfere with the lawful state process that SMP was legally going through.
Richard
Dredd, There is nothing in the statute that requires cities to take action by issuing business licenses to businesses seeking to sell controlled substances. Certainly, a marijuana business could argue that it can’t be penalized for not having a business license, but that is a different issue.
===========================
Their competent counsel disagree with you, as will the court.
The city code at issue specifically targets businesses that the state has legalized and approved.
They had a chance to amend it to make it conform to state law, but refused to do it.
State law specifically says municipal codes cannot comment on marijuana laws in any way that is contrary to state law.
What is it about “no” that Wenatchee does not understand?
“The state of Washington fully occupies and preempts the entire field of setting penalties for violations of the controlled substances act”
“… municipalities may enact only those laws and ordinances relating to controlled substances that are consistent with this chapter …”
“Local laws and ordinances that are inconsistent with the requirements of state law shall not be enacted and are preempted and repealed” …
Their licensed and competent Washington State lawyers filed a lawsuit in the Superior Court which, like Wenatchee, is bound to uphold state law, not municipal acts that are lawless.
Al Zheimers wrote “if you do not mind a bunch of pot heads driving up, parking their cars and shopping in the potshop next door”
Come to Colorado and see how it is actually working out.
“Pot shops buzz, crime eases as Colorado law marks 6 months”
http://www.reuters.com/article/idUSKBN0F817020140703
Dredd, There is nothing in the statute that requires cities to take action by issuing business licenses to businesses seeking to sell controlled substances. Certainly, a marijuana business could argue that it can’t be penalized for not having a business license, but that is a different issue.
The state of Washington, like other sovereigns, has the power to limit the jurisdiction of its courts.
It has the power to allow or disallow then limit municipalities within it.
It does not have the power to do that to the federal government.
So, when it passed this law, it exercised its power over the municipalities of the state:
“State preemption
The state of Washington fully occupies and preempts the entire field of setting penalties for violations of the controlled substances act. Cities, towns, and counties or other municipalities may enact only those laws and ordinances relating to controlled substances that are consistent with this chapter. Such local ordinances shall have the same penalties as provided for by state law. Local laws and ordinances that are inconsistent with the requirements of state law shall not be enacted and are preempted and repealed, regardless of the nature of the code, charter, or home rule status of the city, town, county, or municipality.”
(RCW 69.50.608).
Any municipal law to the contrary is void ab initio, void from the beginning and in effect does not exist.
The federal government can enforce federal law that is contrary to state law.
The point is that the municipalities of the state, like Wenatchee, cannot enforce federal law when their state law specifically outlaws such enforcement.
This will bind the state superior court, in which the instant case was filed, to state law.
So, it will hold that Wenatchee is out of order.
If the federal government changes its mind and later decides to prosecute retailers of marijuana, it will not prosecute the state or Wenatchee, it will prosecute civilian business people.
As long as federal law is against marijuana, the feds can prosecute even though the municipality cannot under state law.
This is coming to your neighborhood (that means near you). Think of the logic here. If the city can not deny a pothead shop a business in downtown or in the shopping mall next to your closed Sears store, then how can they deny it in the house next door to you? Well, you say: the house next door is for residential. Well, the pothead says, if you can deny non residential then you can deny non federal compliance with pot laws and there is no end to your fuddy duddy old artFay ways.
So, if you do not mind a bunch of pot heads driving up, parking their cars and shopping in the potshop next door, then side with the potheads here in this case. Its a slippery slope and better to have local control over the slippery slope than some artFay up in Jefferson City, Springfield, or Sacramento. A city ought to be able to ban liquor stores, tobacco, manure, or any other type of retail store. So what if Sears closed down or pot is no worse than tobacco.
what can i tell ya nikki, there are some folks on here i don’t pay one whole hell of a lot of attention to.
and hey, thanks for the comparison to letterman.
If you take more than a cursory look @ the comment, Jack is not talking about Darren. The link shows hypocrisy, but not by Darren. So, pete, you’re a self parody tonight. Like I have said, you were funny before you became so angry, like Letterman.