{"id":9436,"date":"2021-10-05T12:17:03","date_gmt":"2021-10-05T12:17:03","guid":{"rendered":"https:\/\/www.denverpost.com\/?p=4771382"},"modified":"2021-10-05T12:17:03","modified_gmt":"2021-10-05T12:17:03","slug":"battle-for-broomfields-three-marijuana-retail-licenses-spurs-accusations-lawsuit","status":"publish","type":"post","link":"https:\/\/cannitrol.com\/blog\/battle-for-broomfields-three-marijuana-retail-licenses-spurs-accusations-lawsuit\/","title":{"rendered":"Battle for Broomfield\u2019s three marijuana retail licenses spurs accusations, lawsuit"},"content":{"rendered":"<div id=\"wp_fb_like_button\" style=\"margin:5px 0 5px 5px;float:right;height:100px;\"><script src=\"http:\/\/connect.facebook.net\/en_US\/all.js#xfbml=1\"><\/script><fb:like href=\"https:\/\/cannitrol.com\/blog\/battle-for-broomfields-three-marijuana-retail-licenses-spurs-accusations-lawsuit\/\" send=\"true\" layout=\"standard\" width=\"450\" show_faces=\"false\" font=\"arial\" action=\"like\" colorscheme=\"light\"><\/fb:like><\/div><div class=\"media_block\"><\/div>\n<p><a href=\"https:\/\/www.denverpost.com\/2021\/10\/05\/broomfield-marijuana-licenses-lottery-lawsuit-terrapin\/?utm_source=feedburner&amp;utm_medium=feed&amp;utm_campaign=Feed%3A+dp-news-marijuana+%28Denver+Post%3A+News%3A+Marijuana%29&amp;utm_content=Google+UK#comments-anchor\"><span class=\"spot-im-replies-count\" data-post-id=\"4771382\" \/><\/a><\/p>\n<p>A mad scramble is on in Broomfield to score a trio of coveted licenses to sell recreational marijuana, with 26 applicants jostling for a spot in a city that until now has banned all weed sales.<\/p>\n<p>One established cannabis company is crying foul, charging that the lottery system Broomfield will use this month to award the licenses is essentially rigged to raise the odds for some contenders \u2014 and the city is doing nothing about it.<\/p>\n<p>\u201cThey\u2019re allowing various individuals to submit multiple applications into the lottery through various shell companies,\u201d Jordan Factor, attorney for Terrapin Care Station, told The Denver Post. \u201cWe\u2019re baffled.\u201d<\/p>\n<p>Terrapin Care Station filed suit against Broomfield and a number of the applicants last week, and is seeking a preliminary injunction to stop the city from running the Oct. 21 lottery until the dispute is resolved.<\/p>\n<p>Terrapin points to Broomfield\u2019s own rules, which state that \u201cno person or entity shall apply for more than one license in any location in the city\u201d and that no applicant \u201cmay apply for, or be an owner of, any other business entity applying for another license within the city.\u201d<\/p>\n<p>Yet, among the more than two dozen applicants are several using multiple versions of the same corporate name while at least three contenders are directly related to one another. Terrapin\u2019s suit claims that a number of competitors share the same business address and are submitting the \u201csame walk-up\/drive-through documents, the same control plan for premises use prevention, the same disposal plan\u201d across multiple applications.<\/p>\n<p>\u201cWhile the formal legal names of the entities through which they applied differ, the applications themselves clearly demonstrated that businesses and individuals created multiple entities and submitted applications through each of them,\u201d the document reads.<\/p>\n<p>\u201cIf you\u2019re going to have a fair lottery, each entrant has to have one entry,\u201d Factor said. \u201cWe have no idea why they are choosing to conduct their lottery in an unfair way.\u201d<\/p>\n<p>Broomfield spokeswoman Carolyn Romero said the city can\u2019t comment on ongoing litigation, but she said the 26 applications \u201ctechnically meet the language of the ordinance.\u201d<\/p>\n<p>\u201cBased on the applications received, some related groups or individuals established separate legal entities and submitted applications that are operationally similar for the same location but under different owners,\u201d she said.<\/p>\n<p>The city\u2019s marijuana selection committee will rigorously review each application before entering them into the lottery for a $4,000 license, Romero said.<\/p>\n<p>Broomfield is an untapped market for marijuana entrepreneurs in Colorado, where <a href=\"https:\/\/www.denverpost.com\/2021\/02\/09\/colorado-cannabis-2020-record-sales-year-2-billion\/\">sales set an annual record<\/a> \u2014 $2.2 billion \u2014 in 2020. In January, statewide sales <a href=\"https:\/\/www.denverpost.com\/2021\/03\/11\/colorado-10-billion-marijuana-sales\/\">reached a staggering $10 billion<\/a> since the legal market got off the ground in 2014.<\/p>\n<p>Combine those lofty numbers with the fact that Broomfield was <a href=\"https:\/\/www.denverpost.com\/2021\/08\/13\/colorado-census-data-population-growth\/\">Colorado\u2019s fastest-growing county in the last decade<\/a> \u2014 now with approximately 75,000 residents \u2014 and it\u2019s no wonder cannabis companies want in.<\/p>\n<p>\u201cYou are talking about a huge metro Denver population,\u201d Terrapin Care Station spokesman Peter Marcus said.<\/p>\n<p>And two big cities near Broomfield \u2014 Arvada and Westminster \u2014 are marijuana dry towns, giving the three future Broomfield licensees a relatively unsaturated submarket in which to operate.\u00a0And that, Marcus said, makes it critical that the process to determine the license winners be as fair as possible.<\/p>\n<p>\u201cMerit-based licensing is so important,\u201d he said.<\/p>\n<p>Terrapin currently has half a dozen stores in communities north and south of Broomfield, including Longmont, Boulder, Denver and Aurora.<\/p>\n<p>One of the targets of Terrapin\u2019s lawsuit is Yuma Way LLC, which has six pot dispensaries in Colorado and one in Michigan. CEO Rita Tsalyuk said she, her husband and her son each filed an application for a Broomfield license \u2014 at times using shared or consolidated information \u2014 but that each submission is a \u201cseparate individual business with separate owners.\u201d<\/p>\n<p>\u201cWe know each other, but we\u2019re different individuals,\u201d she said.<\/p>\n<p>Broomfield\u2019s applicant list shows filings under four Yuma names, including Yuma BRIT, Yuma BRKM and Yuma BRAT. Tsalyuk said Broomfield officials told her weeks ago that she was in compliance with city rules taking this approach.<\/p>\n<p>\u201cWe cleared it about 10 times,\u201d she said.<\/p>\n<p>Communities across Colorado have taken different approaches to legalizing pot sales, with some running lotteries, others establishing a maximum number of stores and still others using distance buffers to limit locations. Many cities and towns in Colorado don\u2019t allow sales at all.<\/p>\n<figure id=\"attachment_4771798\" class=\"wp-caption aligncenter size-article_inline\"><img class=\" lazyautosizes lazyload\" src=\"https:\/\/cannitrol.com\/blog\/\/wp-content\/uploads\/2021\/10\/battle-for-broomfields-three-marijuana-retail-licenses-spurs-accusations-lawsuit.jpg\" alt=\"Terrapin Care Station, a recreation cannabis ...\" width=\"3000\" data-sizes=\"auto\" data-src=\"https:\/\/cannitrol.com\/blog\/\/wp-content\/uploads\/2021\/10\/battle-for-broomfields-three-marijuana-retail-licenses-spurs-accusations-lawsuit.jpg\" data-srcset=\"https:\/\/cannitrol.com\/blog\/\/wp-content\/uploads\/2021\/10\/battle-for-broomfields-three-marijuana-retail-licenses-spurs-accusations-lawsuit.jpg 620w,https:\/\/i2.wp.com\/www.denverpost.com\/wp-content\/uploads\/2021\/10\/Imadali_TerrapinLawsuit13.jpg?fit=780%2C9999px&amp;ssl=1 780w,https:\/\/i2.wp.com\/www.denverpost.com\/wp-content\/uploads\/2021\/10\/Imadali_TerrapinLawsuit13.jpg?fit=810%2C9999px&amp;ssl=1 810w,https:\/\/i2.wp.com\/www.denverpost.com\/wp-content\/uploads\/2021\/10\/Imadali_TerrapinLawsuit13.jpg?fit=1280%2C9999px&amp;ssl=1 1280w,https:\/\/i2.wp.com\/www.denverpost.com\/wp-content\/uploads\/2021\/10\/Imadali_TerrapinLawsuit13.jpg?fit=1860%2C9999px&amp;ssl=1 1860w\" \/><figcaption class=\"wp-caption-text\">\n<p>Eli Imadali, Special to The Denver Post<\/p>\n<p>Terrapin Care Station, a recreation cannabis dispensary, has several locations in the Denver metro, including this store on Broadway in Denver on Friday, Oct. 1, 2021.<\/figcaption><\/figure>\n<aside class=\"related right\" \/>\n<p>Broomfield\u2019s elected leaders approved medical and recreational marijuana sales in March. While the cap will start at three licenses, the city is leaving open the possibility of awarding another two licenses a year after sales begin, likely later this year or in early 2022.<\/p>\n<p>David Michel, an attorney who represents five of the Broomfield applicants applying under the trade name Igadi, said Terrapin is misinterpreting the city\u2019s rules.<\/p>\n<p>The situation, Michel said, is similar to the franchise model used by businesses like McDonald\u2019s. In the case of Igadi, the applicants he represents will use the company\u2019s \u201cintellectual property, branding, business practices, and will have the same executive team, but not the same owner.\u201d<\/p>\n<p>Each of the Igadi applicants proposes a store location at the same address on Teller Street.<\/p>\n<p>\u201cThis is not only consistent with Broomfield\u2019s ordinance, but city staff was aware of this structure and agreed it was consistent with their laws \u2013 separate owners capitalizing on the experience of existing marijuana companies,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"<div class=\"media_block\"><\/div>\n<p>Twenty six applicants are jostling for one of three spots in a city that until now has banned all cannabis sales. One established company is crying foul, charging that the lottery system to award the licenses is essentially rigged to raise the odds for some contenders. <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[8293,5062,6811,6897,1547,6892,6813,6848,77,5577,6815,6858,9,5019,441,1,3,61,1736],"tags":[8294,5063,6816,6898,4115,6893,6818,6851,2655,5580,6820,6860,5022,3015],"_links":{"self":[{"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/posts\/9436"}],"collection":[{"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/comments?post=9436"}],"version-history":[{"count":0,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/posts\/9436\/revisions"}],"wp:attachment":[{"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/media?parent=9436"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/categories?post=9436"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/tags?post=9436"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}