San Jose Municipal Code Part 8 Application of Chapter; Other Legal Duties

A. Any existing cannabis Collective, Retail Storefront, Dispensary, operator, establishment, business or provider that does not hold a Notice of Completed Registration from the City of San José at the time of the effective date of this Chapter is not in compliance with the San José Municipal Code and shall immediately cease operations. This Chapter does not create any defense to civil or criminal enforcement of the provisions of the San José Municipal Code until such time, if any, that all requirements of this Chapter are met.

B. No cannabis Collective, Retail Storefront, Dispensary, operator, establishment, business or provider is a legally established use under the provisions of this Code whether in existence before or after the effective date of this Chapter.

(Ords. 30210, 30927, 31273.)

A. It is unlawful for any person to cause, permit or engage in the cultivation, possession, manufacture, testing, sales, transfers, distribution, processing, transporting, delivery or giving away of cannabis. To establish an affirmative defense to civil and criminal enforcement of the provisions of the San José Municipal Code, the person seeking to invoke the defense must establish compliance with all other applicable state and local laws.

B. It is unlawful for any person to cause, permit or engage in any activity related to cannabis, and a person may not establish an affirmative defense to civil and criminal enforcement of the provisions of the San José Municipal Code unless in strict compliance with any and all state and local laws.

C. It is unlawful for any person to knowingly make any false, misleading or inaccurate statements or representations in any forms, records, filings or documentation required to be maintained, filed or provided to the City under this Chapter, or to any other federal, state or local government agency having jurisdiction over any of the activities of Cannabis Businesses.

D. It shall be the responsibility of the Owners or persons working at or for the Cannabis Business to ensure that the Cannabis Business is, at all times, operating in a manner compliant with all applicable state and local laws. Nothing in this Chapter shall be construed as authorizing any actions which violate state law with regard to the cultivation, processing, manufacturing, distributing, transporting, transferring, dispensing, delivering, testing, disposing, and sale of cannabis.

(Ords. 30210, 30927, 31099.)

A. Each and every violation of this Chapter shall constitute a separate violation and shall be subject to all remedies and enforcement measures authorized by this Code. Additionally, as a nuisance per se, any violation of this Chapter shall be subject to injunctive relief, the Cannabis Business's registration being deemed null and void, disgorgement and payment to the City of any and all monies unlawfully obtained, costs of abatement, costs of investigation, attorney fees, and any other relief or remedy available at law or equity. The City may also pursue any and all remedies and actions available and applicable under state and local laws for any violations committed by the Cannabis Business and persons related to, or associated with, the Cannabis Business. Additionally, when the City Manager determines that there is an imminent threat to public health, safety, or welfare, the Cannabis Business's registration shall immediately become null and void.

B. Notwithstanding an initial verification of compliance by the Cannabis Business with the provisions of this Chapter, any Cannabis Business later found to be in violation of any of the requirements of this Chapter at any time is subject to the enforcement provisions provided in this Section.

(Ord. 30210.)

The Cannabis Business and its Owners, Managers, agents, invitees, contractors and employees shall release the City of San José, and its agents, officers, elected officials, and employees from any injuries, damages, or liabilities of any kind that result from any arrest or prosecution of the Cannabis Business and its Owners, Managers, agents, invitees, contractors and employees for violation of federal or state laws and from any and all legal liability related to or arising from the registration of the Cannabis Business or the enforcement of the provisions of this Chapter, in a form satisfactory to the City's Risk Manager. In addition, the Cannabis Business and its Owners, Managers, agents, invitees, contractors and employees shall indemnify and hold harmless the City of San José and its agents, officers, elected officials, and employees for any claims, damages, or liabilities arising from claims filed by third parties due to the operations at the Location or Premises or arising from claims filed by the Cannabis Business's Owners, Managers, agents, invitees, contractors and employees arising out of the possession, cultivation, manufacture, testing, sales, delivery or dispensing and/or on- or off-site use of cannabis provided at the Location or Premises, in a form satisfactory to the City's Risk Manager.

(Ord. 30210.)

A. No Person shall assign or transfer any Notice of Completed Registration issued under this Chapter unless they follow procedures set out under Subsection B and without following these procedures, any attempt to assign or transfer any Notice of Completed Registration issued pursuant to this Chapter shall render the Notice of Completed Registration null and void.

B. Notwithstanding Subsection A above and Subsection 6.88.350.E, a Cannabis Business wishing to transfer ownership or registration of the Cannabis Business may do so provided that:

1. The Cannabis Business and/or Cannabis Business's successor shall submit all required forms, pay any associated fees, and follow any procedures specified in the City Manager regulations.

2. The Cannabis Business and/or Cannabis Business's successor shall meet the requirement for registration under Subsection 6.88.300.G including the full payment of cannabis business taxes, fines, and/or fees. The Cannabis Business and/or Cannabis Business's successor may enter a payment plan in accordance with Subsection 6.88.385 for a term no longer than one year from the date of transfer of registration. A partial payment must be made when entering the payment plan in an amount as determined by the director of finance and all outstanding amounts must be paid in full within one year of the date of transfer of registration.

3. The Cannabis Business must transfer the registration for all locations of the business; no partial transfers of the business will be allowed.

4. A new or amended Notice of Completed Registration confirming the change in ownership or registration is issued.

C. Notwithstanding Subsection B above, a Cannabis Equity Owner may not transfer ownership to a non-equity owner such that the total amount of equity ownership falls below fifty-one percent (51%) for a period of five (5) years following the original date of receipt of a Notice of Completed Registration.

D. Notwithstanding Subsection B above, a Cannabis Equity Business may not transfer shares of ownership to non-equity owners or partners such that the aggregate total of equity ownership falls below fifty-one percent (51%) for a period of five (5) years following the original date of receipt of a Notice of Completed Registration.

(Ord. 31143.)

Editor's note— Ord. 31143, adopted Nov. 5, 2024, amended § 6.88.840 in its entirety, in effect repealing and reenacting said § 6.88.840 to read as set out herein. The former § 6.88.840 pertained to registration nontransferable and derived from Ords. 30210, 30726, 31099.