Upstate New York shop fined $9.5 million for unlicensed marijuana sales

A small shop in upstate New York near Rochester has been hit with a $9.5 million fine after the owner ignored a cease-and-desist order to stop selling cannabis without a license.

George West, the owner of Jaydega 7.0 in the town of Canandaigua, was slapped with the enormous fine this week by Attorney General Letitia James.

James said in a news release that West had been sent the cease-and-desist notice in June 2023, after it was determined by the state Office of Cannabis Management that he’d been selling marijuana without a permit since at least September 2022.

In November last year, the OCM and James were granted a court order to force the shop to close. This month, the court further ordered West to disgorge more than $1 million in illicit profits from unlicensed marijuana sales, along with a penalty of $8.4 million.

“The owner of Jaydega 7.0 refused to follow the law and ignored repeated warnings to stop selling cannabis without a license,” James said in a release. “West must pay $9.5 million for violating our laws and hurting local communities. Stores that sell cannabis must abide by rules and regulations just like any other business in New York.”

State law gives officials the power to fine businesses such as West’s up to $10,000 per day for unlicensed marijuana sales and up to $20,000 per day for continuing such activity after a cease-and-desist order is issued.

The $9.5 million judgment against West is “a combination of disgorgement, administrative fines, daily penalties, and revenue-based penalties,” according to the release from James’ office.

During its investigation of the shop, the OCM obtained records that indicated West brought in at least $2.4 million in sales revenue between June 2022 and October 2023. James’ office found that the Jaydega shop “continued to sell cannabis without a license” until the court order closing the shop was issued in November last year.

The sizable fine is not without precedent. In May, James announced a $15.2 million judgment against David Tulley, an entrepreneur who ran a chain of seven unlicensed cannabis shops in upstate New York.