Michigan town's pot bonanza turns into a marijuana melee over corruption claims

MENOMINEE, Mich. — When this small town in the Upper Peninsula was working on a law allowing the sale of marijuana in 2020, it was warned that restricting the number of dispensaries could lead to a legal quagmire.

The town, which is just across the border from Wisconsin, where pot is prohibited, went ahead and limited the number anyway. Critics said it has since passed "quagmire" and now is in legal Bizarro World.

Matt Cross, a municipal law attorney hired by Menominee to defend it against lawsuits by marijuana companies, said the city's experience should serve as a warning to other towns.

“Menominee is going to be a cautionary tale for any community that wants to opt in to allow these types of facilities," Cross said.

Consider the following curiosities:

The Menominee City Council spent 11 months considering 14 applicants before naming the two winners in 2021. The council was sued by some of the losing applicants, won the lawsuit and promptly changed its mind about the limit, opening the licenses to everyone.

Rize is one of the two original marijuana dispensaries in Menominee selected to operate in the Upper Peninsula city. The City Council has since changed course and opened the market to all applicants, which has prompted a lawsuit by Rize and The Fire Station against the city.

When a citizens’ group tried to hold a referendum to keep the original limit, the council avoided the vote by tacking a minor funding measure to the revised marijuana law, which prevented residents from voting on it.

In opening the licenses to everyone, the council also watered down an ethics rule related to marijuana. Among the nine council members are the brother of a lawyer who represents one of the losing applicants and another councilman who was discussing selling his property to the same applicant, according to council meeting minutes.

Rize and The Fire Station, the two dispensaries that were originally selected, accused the council of having conflicts of interest, engaging in backroom deals and enriching themselves, their relatives and their friends. They hired a private investigator to look into the relationship between the council and the losing applicants.

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