Lawsuit: Years-old land-use settlement restricts Boulder County cannabis company’s expansion

BOULDER COUNTY — A seven-year-old settlement between Boulder County and the landlord of an improperly operating medical marijuana grower is restricting another cannabis company’s ability to expand, a lawsuit filed this week alleges. 

Wild Horse Enterprises LLC, which is suing the Boulder County Board of Commissioners and the county’s community planning and permitting department, claims that Boulder County officials are misinterpreting a 2016 settlement with Emerald Investments Two Ltd., or EIT, the owner of the Broadway property on which Wild Horse runs a marijuana cultivation business. 

Emerald, the complaint claims, “has not always leased units within the parcel (it owns on Broadway in unincorporated Boulder County) to lawful tenants who abide by the land use code.” In the summer of 2012, “Boulder County initiated a zoning enforcement action against EIT related to unlawful cultivation of medical marijuana at the parcel, including building without a permit.”

The landlord and the county reached a settlement in 2016 that restricts, with certain exceptions, the types of cannabis businesses that are allowed to operate on portions of EIT’s Broadway property. 

Later that year, after the medical marijuana growers were evicted, Wild Horse began the process of getting the necessary permits and licenses to open a retail cannabis business on property leased from EIT.

“However, the county could not immediately issue Wild Horse’s business license until permitting issues identified in the settlement agreement were rectified,” the lawsuit claims. “In order to receive final zoning approval and proceed with its license application, CP&P (the Boulder County permitting office) required Wild Horse to obtain electrical permits, affix and/or replace exterior lighting fixtures, repair and/or install mechanical and ventilation systems, and bring the septic system servicing the parcel into compliance, including the installation of an effluent monitor. EIT refused to take any such action itself, so Wild Horse was forced to undertake these efforts to get its license,” at a cost of $400,000.

After the retail cannabis cultivation operation was up and running, Wild Horse began the process of applying to expand its business to include a dispensary and infused-product manufacturing facility.

What Wild Horse didn’t realize, the lawsuit said, is that the county could interpret sections of the settlement with EIT as prohibiting those new uses.

“At no time did any person or agent of Boulder County, including CP&P, tell Wild Horse that it would not be able to expand its operations in the future, or that retail marijuana cultivation was the only approved marijuana establishment use permitted at the parcel.”

This May the county issued a letter denying Wild Horses requests to expand the business operations.

“Boulder County received a complaint for declaratory judgment from Wild Horse Enterprises LLC, which operates a marijuana establishment in unincorporated Boulder County,” the Boulder County commissioners, through a spokesperson, told BizWest in an email. “Wild Horse wishes to expand its business into an additional unit in the building it is operating in. The county has taken the position that the proposed expansion is not permitted under a settlement agreement reached between the county and the owner of the property in 2016, and Wild Horse disagrees with that position. The county will respond to the lawsuit by Nov. 1.”

The county, Wild Horse’s lawsuit claims, is “misinterpreting the terms of the settlement agreement, and its determination is decidedly inconsistent with the settlement agreement.”

The company is asking a judge to overrule the county’s denial and allow Wild Horse to build an infusion operation and retail dispensary.

The lawsuit is Wild Horse Enterprises LLC v. Boulder County Commissioners et al, case number: 2023CV307, filed Oct. 11 in Boulder County District Court.

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