Province terminates retail agreement with urban reserve cannabis store

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This article was published 4/6/2021 (230 days ago), so information in it may no longer be current.

The urban reserve cannabis store whose licence was suspended two weeks has had its retailer agreement terminated by the Liquor, Gaming and Cannabis Authority of Manitoba.

Some believe the matter is the first salvo in a battle over Indigenous rights in the cannabis industry, something observers say was left ambiguous in the original federal legislation to legalize recreational cannabis in 2018.

The Meta Cannabis Supply Co. store at 420 Madison St. that has been closed is owned by a partnership between Long Plain First Nation and High Tide Inc., the company that acquired Meta Growth Corp. in November.

While the regulators have made it clear that store is in compliance, the issue at hand is the operation of an unlicensed store which the regulators claim is selling unregulated product at Long Plain’s Keeshkeemaquah urban reserve in Portage la Prairie which is also owned by the Long Plain First Nation.

Long Plain Chief Dennis Meeches declined to comment on the matter on Thursday, but two weeks ago when the issue first became public he insisted that the Keeshkeemaquah store was selling Health Canada-approved product.

At that time Meeches said, "We are the governmental authority for all business on our lands. We allowed Manitoba to license cannabis on our lands and as you can see they have chosen to remove that licence. We will now manage the licences for that site."

Isadore Day, a former Grand Chief of the North Shore Tribal Council in Ontario and the CEO of cannabis company Red Market Brand that is about to launch is also the CEO of a consulting company that has done work in the cannabis industry. He said Long Plain was put in the situation because the original federal legislation did not clarify Indigenous rights.

"Our communities are looking to find models to work with," he said. "The legal arguments here are going to unpack a number of complex details around how Canada has mismanaged this legislation."

He claims the issues were not addressed at the outset.

"I believe the thinking was, they wanted to move the legislation through quickly and that First Nation issues were left on the back burner and they thought ‘we will apologize later.’"

But rather than address those kinds of First Nation legal matters, the action is clearly more focused on provincial regulations.

Matt Maurer, a lawyer for the Toronto firm Torkin Manes, whose practice includes work with a wide range of cannabis industry stakeholders and is familiar with the Manitoba regulations, said the licence termination likely has something to do with a standard "good character" requirement in licensing.

"I would think the reason they pulled the licence is that they decided the part owner is not of good character/can’t be trusted/won’t carry on the operations of the Meta store in accordance with all the laws and regulations based on what happened at the other store," he said.

Meanwhile High Tide is trying to distance itself from its partner.

Omar Khan, senior vice-president for corporate and public affairs for High Tide Inc. said it has no relationship with the Keeshkeemaquah store and that all of its stores, including the Madison location, operate in full compliance with all cannabis laws and regulations.

"In fact," he said. "The LGCA has previously confirmed that their actions related to this store are as a result of unrelated activities by the majority partner and that this particular store has been in full compliance. We take compliance very seriously… We hold all partners to the same standards as ourselves and, as such, are in the process of selling our remaining interest in the partnership to Long Plain First Nation."

The provincial agencies that regulate the sale and distribution of cannabis in Manitoba, said that the action was taken to ensure safety and fairness in the industry.

Kristianne Dechant, CEO of the LGCA, said in a prepared statement, "Protecting the integrity of Manitoba’s cannabis licensing framework is a fundamental priority. Manitobans who choose to use cannabis should be assured that they are buying safe products from licensed and regulated retailers."

The LGCA said the action was taken after several attempts were made over the last month to work with the First Nation to operate within Manitoba’s legal cannabis framework but that Long Plain did not respond.

Meeches has intimated in the past that a legal battle was imminent.

"It looks like we may end up in court because of Brian Pallister and his heavy-handed tactics."

Isadore Day said he is supportive of what Long Plain is trying to do and agrees with Meeches’ contention that the province is being heavy-handed in drawing the legal battle lines.

"I think it is rather unfortunate that the government is taking that position. I think it is a lot more complex," he said. "The solutions need to be found on the ground. Why pull the legal battle now when these things could be addressed through goodwill politics and collaboration on a nation-to-nation level?"

martin.cash@freepress.mb.ca