C.A. 1st;

The First Appellate District reversed a trial court order. The court held that a city could rationally limit its grant of limited immunity from prosecution to those medical marijuana dispensaries that had demonstrated past compliance with local laws by timely payment of a local business tax.

Local zoning ordinances in the City of Vallejo do not recognize medical marijuana dispensaries as a permitted land use. As a result, such businesses constitute a public nuisance. In 2011, faced with a proliferation of medical marijuana dispensaries, and lacking the financial resources to enforce land use restrictions, the city enacted an ordnance imposing a business tax on dispensaries. The city described the measure as a “first necessary step in taxing and regulating” the dispensaries. In 2015, the city council adopted Ordinance No. 1715, which afforded “limited civil immunity” to those dispensaries that had previously obtained tax certificates and timely paid their quarterly taxes. NCORP4, Inc., doing business as Nature’s Love Collective, promptly paid all taxes owed from 2011 through 2015. Finding NCORP4’s later payment of taxes did not entitle it to limited immunity, the city later sued to enjoin as a public nuisance NCORP4’s further operations as a dispensary.

The trial court denied the city’s motion for a preliminary injunction, finding that Ordinance No. 1715 constituted an ex post facto law, “making activity that was legal at the time committed (or at least subject to very limited penalties) suddenly and retroactively illegal (or subject to greater and much different penalties).”

The court of appeal reversed, holding that Ordinance No. 1715 did not constitute an ex post facto law. First, the constitutional prohibition on ex post facto laws applies to criminal statutes only; it does not apply to local ordinances regulating the operation of medical marijuana dispensaries. Further, the ordinance did not retroactively increase the penalties for nonpayment of the dispensary tax. Those penalties, which included late fees and the potential for misdemeanor prosecution, remained unchanged. Rather, the ordinance conditioned dispensaries’ immunity from prosecution as a public nuisance on, among other things, compliance with the 2011 tax ordinance. Land use regulation is a function of local government. The city could rationally conclude that a dispensary’s prior timely payment of taxes indicated a willingness to continue to act in a law-abiding manner, and could thus rationally limit its grant of limited immunity to those dispensaries that had demonstrated past compliance.