Contractual disputes between licensees are not regulated by the Department of Cannabis Control (DCC). The best way to protect yourself from fraud, scams, or other business disputes is to be aware of potential risks ahead of time.

Before entering a business deal

• Vet the people you intend to enter a business deal with. This may include doing additional research and consulting peers or industry associations about their experiences working with them.
• Make sure any individual or commercial cannabis business is appropriately licensed.
  • For commercial cannabis businesses licensed by DCC, visit our website: Cannabis Unified License Search.
  • For professionals licensed by the Department of Consumer Affairs (DCA) (e.g., accountants, security guards, contractors and more), visit DCA’s website: Department of Consumer Affairs’ License Lookup Webpage.
• Get a written copy of any guarantees or promises.
• Ask about any policies related to refunds or disputes.
• Do not sign any contract or legal document unless you and/or your lawyer have reviewed the contract; this includes:
  • Understanding the contract-if there is something you do not understand, ask for an explanation. If you have doubts about an offer, take some time to think it over. Do not be pressured to sign the contract before you are ready.
  • Not signing a contract with blank spaces-cross out any blank spaces that do not apply to the transaction.
  • Getting all promises in writing-any verbal promises should be documented in the contract.
  • Making changes to the contract before signing-if you want to amend the contract, do it before signing.
  • Getting an exact copy of the executed contract-get a copy of the contract when you sign it.

After entering a business deal

Not only are you required to maintain records related to the commercial cannabis business pursuant to California Code of Regulations (CCR) Title 4 section 15037, but it’s good practice to save all business records including contracts, sales receipts, cancelled checks, etc. for future reference.

Solving potential disputes

In the event of a dispute, reach out to the business or person you have contracted with as soon as possible. Maintain copies of all correspondence. If that doesn’t resolve the problem, you may want to file a complaint with the District Attorney’s office in your county and the appropriate party.

• For potential violations related to commercial cannabis licensure, file a complaint using DCC’s complaint portal
• For potential violations related to professional licensure, file a complaint using DCA’s complaint portal
• For consumer complaints, file a complaint using the California Attorney General’s Office complaint portal
• For business complaints, post a review, or report a scam using the Better Business Bureau online portal

Seeking civil remedies

If attempts to resolve your dispute have failed, you may be able to file a claim in the California Courts. When a party wins a contractual dispute, the court rules that the other party owes them. However, the court does not collect the judgment on behalf of the winning party. The winning party must take steps to collect on their judgment.

Resources and information to help you understand your options and navigate your court case, including step-by-step guides for following procedures and collecting the judgment is available on the on the California Courts website: California Courts Self-Help Guide.

Notifying DCC

CCR section 15036 requires you to notify DCC in writing of a civil penalty or judgment rendered against your licensed cannabis business or any owner in their individual capacity within 48 hours of delivery of the verdict or entry of judgment, whichever is sooner. Failing to do so may result in disciplinary action.