Second MSO Challenges New Jersey Labor Licensing Mandate In Federal Court

Verano Files Federal Suit Against State Mandate

Chicago-based Verano Holdings Corp. filed a lawsuit in federal court on July 31 to challenge New Jersey’s labor peace agreement requirement. The company argues that the state’s licensing mandate is unconstitutional and violates federal labor law.

Verano operates four retail locations and a cultivation center in New Jersey with more than 300 employees.

The complaint states that Verano signed its agreement “under duress” and refers to the state law requirement as “illegitimate illegal coercion.” The company claims it would have signed no labor peace agreement at all if it had been free to do so. Verano is seeking a declaration that the mandate cannot be used to deny or revoke its licenses.

The lawsuit names the state’s Cannabis Regulatory Commission and Local 360 of the United Food and Commercial Workers Union as defendants. Verano argues that its agreements with the union are voidable because they were signed under the belief that compliance was legally required. The company warns that losing its license would force it out of business and result in the firing of its workers.

Curaleaf Ruling Shapes Legal Strategy

Verano’s suit follows a final judgment earlier this month in a separate case involving Curaleaf Holdings. A federal judge declared New Jersey’s labor peace agreement requirement unconstitutional in that prior litigation. Verano states that the Curaleaf ruling has “direct and immediate significance” for its own case.

The Curaleaf case began after regulators attempted to fine the company $610,000 and withhold its license in April 2025. Curaleaf had let its labor agreement expire, triggering the state’s enforcement action. Verano hired Littler Mendelson, the same management-side law firm that represented Curaleaf in its successful challenge.

Verano argues that the validity of New Jersey’s labor peace agreement requirement is no longer an unsettled question. The company contends that the mandate is preempted by federal labor law and may not lawfully be enforced. Verano seeks a judicial clarification that the Curaleaf ruling applies to its specific licensing situation.

State Response and License Renewals Pending

New Jersey has appealed the Curaleaf case to a federal appellate court but has yet to answer the Verano complaint. A state deputy attorney general asked the judge on Wednesday for an extension to file a reply by Sept.

The state’s response to the new lawsuit remains pending in federal court.

Verano’s Neptune Township license was up for renewal on August 1, while its Mount Holly license renewal is scheduled for November. The company holds licenses for dispensaries in Elizabeth, Lawrence Township, Neptune Township, and Mount Holly. It also operates a cultivation and processing facility in Branchburg.

Spokespeople for the union and the Cannabis Regulatory Commission did not respond to requests for comment regarding the lawsuit. The commission is scheduled to meet for a public meeting on Thursday.

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