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Nevada marijuana companies recorded a victory yesterday after Carson City District Judge James Todd Russell denied a preliminary injunction from liquor distributors.
The companies wanted to stop the Nevada Tax Department from allowing licensed marijuana businesses transport marijuana from the cultivation facility to the dispensary.
Judge Russell also revoked a temporary restraining order that stops Nevada’s Tax Department from moving forward with application from licensed marijuana companies looking to distribute the retail product.
The liquor distributors plan to appeal this decision to Nevada’s Tax Commission.
Lack of Qualified Distributors
Although the liquor distributors are upset with the decision, the lack of distribution has been significantly impacting Nevada’s legal marijuana industry.
The legislation passed by Nevada in November provided alcohol distributors with exclusive rights to transport recreational marijuana from the grower to dispensary, but the state determined that there are currently not enough qualified alcohol distributors for the job.
Last week, Nevada’s Department of Taxation reported that sales have dropped 20% to 30% since the July. According to the report, this shortage is leaving dispensaries with a product selection that's been reduced by more than half.
A Story to Watch
We are favorable on the outcome of this case and will keep an eye on how this story develops. Marijuana businesses in Nevada have benefited from the recent change in legislation and this news should help support growth.
Inventory management is key for success and these dispensaries want to make sure they are always holding the products that in the highest demand.
We will monitor how this development impacts sales growth going forward and expect to see the industry benefit from fastest and more deliveries.