A federal judge declined to block New Jersey’s requirement that cannabis businesses sign Labor Peace Agreements (LPAs) in the ongoing case brought by the Multi-State Operator (MSO) Curaleaf.
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This allows the rule to stay in force while the case continues.
Judge Michael A. Shipp, of the US District Court for the District of New Jersey, ruled against Curaleaf Holdings Inc.’s request for emergency relief. Notably, he left the underlying legal question unsettled.
Compliance Overhead and the Online Contrast
Former New Jersey Governor Phil Murphy (D) signed into law the Cannabis Regulatory Enforcement Assistance and Marketplace Modernization Act, known as CREAMMA, in February 2021.
It implemented the 2020 referendum, decriminalized possession, and established a legal adult-use cannabis market.
So, cannabis operators must satisfy many obligations before they can do business in New Jersey at all. Under CREAMMA, operators must both sign LPAs and engage in collective bargaining with organized labor. These are two distinct, active requirements.
That compliance weight stands in sharp contrast to the online social space where the overhead is minimal. A service built around the old Lucky Crush chat format pairs strangers on demand under almost none of that licensing and bargaining structure.
What Judge Shipp Decided
Bloomberg Law reported that Judge Shipp issued an unpublished opinion that Curaleaf Holdings Inc. had not demonstrated the “irreparable harm” that courts require before granting a preliminary injunction.
That standard is the operative legal test for emergency relief. A party seeking a preliminary injunction must show, among other things, that it will suffer injury that cannot be remedied later if the court waits for full proceedings. Judge Shipp concluded Curaleaf did not clear that bar.
They had sought the injunction to halt enforcement of the LPA requirement while its challenge worked through the courts.
Critically, the ruling was not a vindication of the regulation on the merits. Judge Shipp signaled skepticism that the Labor Peace requirement was actually permitted under federal law, even as he declined to block it. A court can find that a challenger has not met the high threshold for emergency relief without endorsing the challenged rule.
What CREAMMA Actually Requires
The CREAMMA law included labor conditions in the licensing structure for cannabis operators in the state.
Under CREAMMA, signing a Labor Peace Agreement is a condition of doing business. It is not an optional best practice. Beyond signing, cannabis companies are also required to bargain with organized labor. These are two separate obligations. The first demands that a formal agreement be in place. The second demands active negotiation with labor representatives. Together, they represent a layer of ongoing compliance that sits on top of the standard licensing, permitting, and regulatory requirements for cannabis businesses.
It is this dual mechanism that Curaleaf is contesting. New Jersey’s cannabis employment rules extend well beyond the labor peace question. But the CREAMMA requirements at issue here are specifically the ones that condition a company’s ability to operate on its relationship with organized labor.
The Ruling’s Effect and What Remains Unresolved
For cannabis operators in New Jersey, the immediate practical consequence is straightforward. The requirement stays in force. Businesses must continue to comply while the case proceeds, regardless of the judge’s expressed doubts about the regulation’s legal foundation.
Those doubts, however, are not a minor footnote. Judge Shipp’s skepticism about whether the LPA regulation survives scrutiny under federal law points directly to the unresolved tension between state cannabis regulation and federal authority.
It’s a tension that shapes the federal cannabis scheduling process and the overall legal environment in which these businesses operate.
A judge declining to grant emergency relief is not the same as a judge ruling the challenged law is valid. The case remains active. The question of whether New Jersey’s LPA mandate is compatible with federal law has not been answered. Judge Shipp’s opinion preserved the status quo for now. But the legal uncertainty he identified is still very much alive.
