Small Businesssmall-business-news-and-trends

Landlord Cleared To Evict Bankrupt Marijuana Dispensary

Landlord Cleared To Evict Bankrupt Marijuana Dispensary
Drew Guarini
By 

Contributor

FILE - This Sept. 15, 2009 file photo shows marijuana plants in Seattle at a medical marijuana growing operation. Tax enforcers have started auditing medical marijuana dispensaries in Washington, escalating a dispute over whether the outlets should be collecting money for state government. The state Department of Revenue has worked since 2010 to tell marijuana establishments that they must remit sales taxes on their transactions. Some 50 dispensaries have registered with the state, helping the state collect some $750,000 in taxes from the industry over the span of one year. Officials believe that there are many other outlets that remain unregistered, and that some registered entities are improperly reporting that they had no taxable business. (AP Photo/Ted S. Warren, File)
FILE - This Sept. 15, 2009 file photo shows marijuana plants in Seattle at a medical marijuana growing operation. Tax enforcers have started auditing medical marijuana dispensaries in Washington, escalating a dispute over whether the outlets should be collecting money for state government. The state Department of Revenue has worked since 2010 to tell marijuana establishments that they must remit sales taxes on their transactions. Some 50 dispensaries have registered with the state, helping the state collect some $750,000 in taxes from the industry over the span of one year. Officials believe that there are many other outlets that remain unregistered, and that some registered entities are improperly reporting that they had no taxable business. (AP Photo/Ted S. Warren, File)

It's still not clear whether San Diego marijuana dispensary Mother Earth's Alternative Healing Cooperative Inc. will be allowed to reorganize under Chapter 11 of the Bankruptcy Code, but it's already had its first hit of disappointment. The U.S. Bankruptcy Court in San Diego has granted the landlord of Mother Earth's headquarters permission to move forward with evicting the dispensary.

Usually when a company files for bankruptcy protection, all legal action it's involved in is halted for the duration of its Chapter 11 case, a provision of the Code called the automatic stay. However, creditors and other parties involved can petition for relief from the automatic stay.

That's what landlord Wing Avenue Investments LLC did. It petitioned the court for permission to move forward with its eviction of Mother Earth, and Judge Laura Taylor agreed.

Read more on The Wall Street Journal

Related

small businesssmall-business-news-and-trends
|
Submit a tip

Popular in the Community

Close

What's Hot