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MMJ Growing Pains

MMJ Growing Pains

Since California led the way in 1996, medical marijuana has been legalized in 23 states and the District of Columbia.  Fourteen other states recently had medical marijuana decisions on the ballot last year or plan to in the coming year.  Even Congress has now put its support towards medical marijuana and hemp growers in the latest Omnibus bill. As the medical marijuana industry grows beyond infancy, so does the scrutiny of its business liabilities.  It seems as though every day there is a new growing pain for the industry exposed in a major publication. Today we’re focused on two important liability concerns.   The Products Liability Concern Because MMJ dispensaries operate like pharmacies, it is generally assumed that they should be insured like pharmacies.  However, products from pharmacies and dispensaries are tested, approved and labeled very differently from one another. This difference requires a unique type of insurance coverage specifically for MMJ business owners that a pharmacy owner could more or less do without. The coverage is called products liability. Products liability insurance is usually excluded from general liability insurance policies for medical marijuana dispensaries.  This is an essential coverage as it protects dispensaries in the event of claims due to illness or injury from cannabis products.  These claims are on the rise as more individuals are exposed to MMJ, particularly when those individuals experiment with various ways of consuming THC. A class action lawsuit filed in Colorado last year (Coombs v. Beyond Broadway) alleges that many people became ill after eating THC-infused chocolate samples at an event.  The class action is open to all attendees who may have been served chocolate samples at the event, so...