Judge halts effort to license new Nevada recreational pot distributors

CARSON CITY — A district judge on Friday temporarily halted any effort by the Department of Taxation to license additional distributors of recreational marijuana other than liquor wholesalers.

The order sought by the Independent Alcohol Distributors of Nevada was granted by District Judge James Todd Russell after he said the tax agency at a Thursday meeting appeared to have a predetermined outcome in place in support of allowing more than just liquor wholesalers to distribute pot from grow facilities to retail establishments.

Taxation Executive Director Deonne Contine at that meeting found that the number of liquor wholesalers was inadequate, and she said the agency would license marijuana businesses to distribute pot as well. She said the liquor industry was not adequate to maintain a supply of the legal drug and that tax collections could suffer as a result.

With six liquor wholesalers already licensed, Russell said it’s unlikely that there will be any disruption in the delivery of marijuana to the states’s 50 retail stores while he considers the issue.

Russell said it appears as if the liquor wholesalers, who have an 18-month exclusive right to distribute recreational pot as approved by voters in November with Question 2, have been denied their due process rights by the agency. The exclusivity can be overridden by the tax agency if there is a determination that liquor distributors cannot perform the task adequately.

A hearing on the matter is set for Thursday. It will be the third hearing on the issue in the last few months after recreational sales began July 1.

Contact Sean Whaley at swhaley@reviewjournal.com or 775-461-3820. Follow @seanw801 on Twitter.

Temporary restraining order by Las Vegas Review-Journal on Scribd