After being held out as an example of how a new state law was allowing NYC to quickly stamp out unlicensed cannabis shops, New City Smoke Shop in downtown Manhattan is back up and running as errors in execution and legal challenges hamper efforts to shut down thousands of weed shops, the Daily News has learned.

The program, so far, has proven susceptible to administrative errors on the city’s part and legal attacks. Shops are not always properly served summonses — sometimes, the wrong person received the summons or sealing orders — which leads to case dismissals during administrative hearings. New City was able to get back up and running less than two months after its closure as a result of the administrative error that’s allowed at least two dozen smoke shops to stay open.

Lance Lazzaro, a cannabis attorney who filed a class-action lawsuit against the city to stop the shop closures, called the process “completely dysfunctional.”

“I’ve never seen anything like it in this world,” Lazzaro said. 

As the city has struggled to contain the explosion of unlicensed weed stores, a new law passed as part of the state budget this Spring giving the city broader powers. The closure of New City was part of “Operation Padlock to Protect,” an initiative by the Sheriff’s Office, the NYPD, and the New York City Department of Consumer and Worker Protection aimed at shutting down the stores.

Despite the problems, the city says it is tackling the issue on a broad scale, though Adams has walked back an earlier statement he’d be able to shut down all illicit shops within 30 days of the new law being passed. Since the effort began in early May, the city has raided 535 stores, according to the Mayor’s Office. Millions in fines have been levied. There are currently only 141 state-authorized adult-use cannabis dispensaries across New York state.

“While we continue to develop best practices around these operations, we have already sealed over 530 illegal cannabis and smoke shops, seized over $17.5 million in illegal products, and issued more than $41 million in penalties just two months into our enforcement efforts,” a City Hall spokesperson said in a statement.

Service issues

But City Council member Gail Brewer, whose Upper West Side district has been inundated with smoke shops, points to the program’s shortcomings.

Data from the City Council Oversight & Investigations Division, of which Brewer is the chair, obtained by the Daily News, shows that one in five adjudicated violations were ultimately dismissed as of June 27, often because the violations weren’t served properly. Within five days of a raid, the Office of Administrative Trials and Hearings, or OATH, must adjudicate the pot shops, though OATH only makes recommendations, with the final decision falling on the Sheriff’s Office.

About half of 48 OATH dismissed summonses during the first few weeks of the program, from May 4 to May 23, were a result of the businesses being improperly served, according to the City Council data. The data also showed that 24 of the dismissed summonses resulted in the initial closure lifted. In 13 cases from that same period, the summons was dismissed but the sealing order remained in place, and in nine cases, the agency withdrew the case.

“All that effort — and I’ve been there, they take hours with those — you do all that … and then it’s all for naught,” Brewer said. “So it seems to me that you should put the same effort into service.”

The spokesperson for the Adams administration said that in cases where OATH, dismissed shop sealing orders due to improper servicing, the sheriff can go back and reinspect — although the city does not track how many stores have reopened. As of July 5, eight shops that opened after being forced to close have been re-inspected and shut down again, the spokesperson said.

The city also doesn’t have isn’t a formal reinspection process in place, the Adams spokesperson said, but area NYPD officers can notify the “Operation Padlock to Protect” task force.

“The Sheriff’s Office and NYPD have to pay extra attention to stores that reopen after sealing, whether they reopened because the case was dismissed or because they paid their fines because we know they are likely to sell illegal products again,” said Brewer, who has led a push for shuttering illicit pot shops.

Triumphant press conference

New City Smoke Shop was touted as one of the first shops shut down under the new initiative, signifying the beginning of the end for the, by some estimates, nearly 3,000 unclicensed smoke shops in the city. 

Sheriff Anthony Miranda even zoomed into an Adams press conference mid-shop-shutdown.

Miranda rattled off a list of illicit items — cannabis, illegal cigarettes, pre-roll, mushrooms — during the Mayor’s May 7 press conference.

“This is just one shop in the five borough operation that we’ve conducted today,” he said. “We had teams in all five boroughs executing inspections as we speak, and we’ll be sealing these locations after the inspection.”

“Thank you. Great job. Let’s close these shops down,” Adams responded, calling it a “very sophisticated operation.”

But the shop hadn’t been served its summons correctly, according to Brewer’s office, and the case against the shop was dismissed on June 14. It was unsealed a week later.  The News was unable to reach anyone at New City.

Lazzaro, the cannabis lawyer, said he has had nearly two dozen shops reopened after challenging their closure in court. Improper service remains a “major problem,” he said.

Under the new provision in state law, local enforcement agencies can shut down spots that pose a health and or safety threat — for example, selling marijuana to minors or operating close by a school or place of worship.

Before, the city sheriff’s office and the NYPD couldn’t shut down an illicit smoke shop unless they got approval from the state’s Office of Cannabis Management. Past crackdowns from both city and state required a longer process and legal proceedings, and they failed to make a dent in the thousands of stores across the city.

With Chris Sommerfeldt