Nevada regulators reject alcohol distributors' marijuana appeal

CARSON CITY, Nev. (AP) - The latest on a legal battle over licenses to distribute recreational marijuana to retail dispensaries in Nevada:

3:30 p.m.

Nevada's marijuana regulators have rejected an appeal by a group of alcohol distributors who wanted to block the state from licensing pot businesses to transport marijuana from growers to retail stores.

The state Tax Commission voted unanimously Tuesday to uphold the Tax Department's earlier decision to expand the licensing to those other than liquor distributors because they have been unable to keep up with demand.

The distribution turf battle has been tied up in district court and administrative appeals since legal recreational sales began July 1.

Kevin Benson a lawyer for the Independent Alcohol Distributors of Nevada says they haven't decided whether to file another lawsuit challenging the state's position.

Tax Department spokeswoman Stephanie Klapstein says it's not clear how soon the new distribution licenses could be issued.

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2:15 p.m.

A battle over Nevada's pot supply is raging before state regulators who decided earlier this month there aren't enough alcohol suppliers to meet delivery demands for the state's newly legalized recreational marijuana industry.

The state Tax Commission is hearing an administrative appeal Tuesday by alcohol wholesalers who argue the law that legalized marijuana last November gave their industry exclusive rights to distribute pot from growers to storefronts until next year.

A lawyer for the alcohol group told the commission that marijuana retailers are boycotting existing liquor distributors to exaggerate bottlenecks in a bid to become their own middlemen to get products from cultivators to storefronts.

Attorney Kevin Benson says that creates a false appearance that there aren't enough distributors to meet market demand.

Lawyers for marijuana businesses are also set to make presentations.

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9 a.m.

Nevada's marijuana regulators are gathering in Carson City again to try to finally resolve a turf battle over distribution licenses that has tied up deliveries and slowed the sale of some pot products since recreational sales began July 1.

The state Tax Commission scheduled a hearing Tuesday on an administrative appeal by a group of alcohol wholesalers who argue their industry has exclusive rights to distribute marijuana from growers to storefronts until next year under the ballot measure voters approved last November.

A judge refused earlier this month to extend an injunction prohibiting any distribution licensees for non-liquor businesses, partly because he said they hadn't exhausted the administrative appeal process.

The tax commissioners decided Aug. 21 there aren't enough alcohol distributors to meet the high demand. But they agreed to postpone any additional licensing until they hear Tuesday's appeal.

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