Court finds alleging an inability to sell property located next to cannabis growing operation is a sufficiently stated injury to allow RICO suit by neighbor against marijuana farm to proceed.
In another case about the lowered property value and references to the smell from cannabis farming operations, a Federal Magistrate in Oregon has recommended the District Court allow a suit to proceed based on this Second Amended Complaint filed by the plaintiff against a host of defendants that she asserts, are responsible for her inability to sell her land – located adjacent to the cannabis farming operation defendants are involved in.
Those following this cannabis farm nuisance issue on the blog will note the pervasive and recurring issue of RICO assertions based on an otherwise lawful farming activity made illegal by the Controlled Substances Act. A traditional lawsuit for nuisance or the diminution in value would not carry the threat of treble-damages or attorneys’ fees nor would it likely end up in federal court when made between landowners and operators in a single state.
You can read the Magistrate Judge’s full recommendations here.
In sum, the arguments that the Judge appears to agree with for allowing the lawsuit to proceed are:
- The financial loss of an inability to sell – alleged as an inability to sell the property at all – circumvents the usual requirement that a concrete financial loss be proven in a situation as the “inability to sell” is itself an allegation of “conduct [that] amounts to a barrier that prevents [plaintiff] from seller her property and converting the property’s equity into a pecuniary form.”
- The intent to sell the property and the inability to sell based on the cannabis activity next door is a cognizable injury “Plaintiff is allegedly unable to monetize her property interest because of the Marijuana Operation. Even if the nuisance has abated, or were to cease in the future, plaintiff has lost the ability to monetize her property at the time she wishes, which may lead to damage that cannot be remedied via a future sale when the nuisance ends. In addition, whether the nuisance has ceased, or is temporary, is a question appropriately resolved on summary judgment. Plaintiff’s allegations, taken in the light most favorable to her, establish a past harm, rather than a prospective or speculative harm, for which she could recover under Oregon law. Accordingly, the motion to dismiss should be denied.”
- That the marijuana operation next door, with its attendant smell and other issues is a plausible cause of plaintiff’s alleged inability to sell – plausible enough to withstand a motion to dismiss. “Accepting plaintiff’s allegations as true establishes that plaintiff has been attempting to sell her property since April 2019, her property has not sold, there is a smell of marijuana on her property that is heightened on warm days, she has reduced her asking price several times, and she has yet to receive even a single offer at any price, even though her asking price “is materially less than the sale prices of comparable properties not located next door to marijuana operations” … That allegation provides some support for plaintiff’s assertion that the Marijuana Operation has not abated. Coupled with the allegation that she continues to smell marijuana on her property, the Court could plausibly infer that the Marijuana Operation has not abated and is preventing plaintiff from selling her property.”