Second major marijuana MSO sues New Jersey over labor-friendly licensing requirement

A second major marijuana multistate operator is going to federal court to challenge a licensing requirement friendly to organized labor in New Jersey cannabis law.

And with a federal judge already declaring New Jersey’s labor-peace agreement requirement unconstitutional in a separate case, Chicago-based Verano Holdings Corp. believes its suit, filed July 31, will prevail, records show.

With more than 300 employees in the Garden State, Verano is one of the biggest cannabis companies in New Jersey, according to NJ.com. Like other vertically integrated MSOs in the state, it has a cultivation center feeding four retail locations.

Why is cannabis MSO Verano suing New Jersey?

Like other states including New York and California, New Jersey requires cannabis companies of a certain size to sign “labor peace agreements” with a recognized union.

The pacts require management and labor to allow workers to consider forming a union without interference on either side, such as management anti-union agitation or a labor-side work stoppage.

But according to Verano, it only signed a labor peace agreement “under duress,” referring to the state law requirement as “illegitimate illegal coercion,” according to filings.

What other cannabis companies sued New Jersey?

According to Verano, the Curaleaf “ruling has direct and immediate significance” in its case, as per filings.

“In light of (that case), the validity of New Jersey’s LPA requirement is no longer an unsettled question,” Verano’s lawsuit said, adding that the LPA requirement “is preempted by federal labor law and may not lawfully be enforced.”

Verano also hired the same management-side law firm, Littler Mendelson, that represented Curaleaf, records show.

So far, the Curaleaf ruling only applies to that company. Verano’s lawsuit seeks a declaration from a judge clarifying that the ruling also applies to Verano.

Are cannabis companies labor-friendly?

The case is one of several filed by cannabis companies across the country against the labor-peace agreements that appear in several states’ regulations.

Following a lawsuit, a federal judge in Oregon declared a similar measure unconstitutional in 2025.

In that case, the state filed an appeal that was withdrawn in April after state lawmakers, at the request of organized labor, struck the requirement from state law.