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A cannabis company has filed a suit against Hopewell Borough, a municipality in Mercer County, over its cannabis licensing process, alleging a conflict of interest with its mayor, former municipal clerk and a cannabis business.
The lawsuit brought by Sourland Provisions, which was denied a retail sales license, alleges the municipalityâs mayor, Paul Anzano, served as another cannabis companyâs legal advisor and that company ultimately got approval.
According to the lawsuit, Anzano had started helping the company, Evolve Sky, even before Hopewell opted in to allow adult-use cannabis sales.
âMayor Anzano began aiding Evolve Skyâs efforts to establish operations in the borough, referring to himself as Evolveâs âadvisorâ with respect to its plans to obtain municipal approval for several types of adult-use cannabis businesses,â the lawsuit said.
In denying Sourlandâs application, the municipality said the companyâs application was rejected because it turned in a fee late, according to local news organization MercerMe. Sourland Provisions, an LLC based in Princeton, denies the claim.
Anzano has denied the allegations in the lawsuit and said he had also supported Sourlandâs application and helped push the municipality toward being more open to cannabis businesses.
âI find it very unfortunate for them â because if it wasnât for them, we wouldnât have made the progress that we made,â Anzano said. âI was hoping that they would be successful.â
The lawsuit claims the company that did get approval, Evolve Sky, is owned by the same people that own Turning Leaf Centers, another cannabis company the lawsuit alleges Anzano tried to get approved in 2018.
Turning Leaf Centers was denied a medical license to operate in Hopewell on December 17, 2018, according to a Department of Health letter, which was the approving department for cannabis businesses before recreational use was legalized in 2020. The stateâs newly formed Cannabis Regulatory Commission is now in charge.
The lawsuit alleges that the same people that owned that company are now reapplying under the Evolve Sky name.
According to public records, some of the people registered with an Evolve Sky LLC and Evolve Cannabis LLC are also names registered with Turning Leaf Centers in New Jersey.
NJ Advance Media found some of the same names showing up with a company that also called itself Turning Leaf Centers in Massachusetts in documents that come from the Massachusetts Cannabis Control Commission website.
On multiple occasions, the company describes its members as having ties to New Jersey. Many of the names mentioned interconnect with names that were on business documents in the New Jersey business entities.
NJ Advance Media sent emails to addresses associated with those names and received no response by deadline.
After cannabis applicants are approved on the local level, they still have to be approved by the CRC, which also conducts its own background checks, including whether applicants are establishing shell companies or running afoul of ownership limitations.
âWe canât comment on pending applications,â said a CRC spokesperson. âAnything untoward in applications is investigated.â
The lawsuit is one of many across New Jersey as it relates to the cannabis industry.
Some of the lawsuits, which allege corruption in the local approval process are becoming widespread throughout the state.
The legislation that was passed by lawmakers gave municipalities the power to license cannabis as they saw fit, with fees, license caps and scoring processes that functioned independent of regulator oversight. State regulators can only approve as many businesses that make it through the local process.
The rest of Hopewell Boroughâs council through its lawyer, Lisa Maddox, declined to comment.
Jelani Gibson is content lead for NJ Cannabis Insider. He may be reached at jgibson@njadvancemedia.com. Follow him on Twitter @jelanigibson1 and on LinkedIn.