Verano Holdings has filed a labor peace agreement lawsuit in federal court that does something unusual: it sues the state regulator and the union Verano itself signed contracts with, and asks a judge to let the company tear those contracts up. The complaint landed July 31, 2026 in the District of New Jersey as Verano Holdings Corp. v. New Jersey Cannabis Regulatory Commission, No. 3:26-cv-09706-GC-TJB. You can read the full complaint here.
Nothing has been decided. No answer, no hearing, no ruling. But the theory is worth understanding, because if it works it reshapes cannabis labor law in a dozen states.
What the labor peace agreement lawsuit claims
New Jersey conditions cannabis licensure on maintaining a labor peace agreement — an LPA — under N.J. Rev. Stat. § 24-6I-36.c and N.J. Admin. Code § 17:30-9.4(g). Verano’s single count says that requirement is preempted by the National Labor Relations Act under Garmon and Machinists, because a state cannot regulate the relationship between employers and unions in a space Congress occupied.
The defendants are the Cannabis Regulatory Commission, Chair Diana Houenou, Commissioners Krista Nash and Amelia Mapp, Acting Executive Director Christopher Riggs — and UFCW Local 360. Verano runs four Zen Leaf dispensaries (Elizabeth, Lawrence Township, Neptune Township, Mount Holly) plus a 120,000-square-foot cultivation and manufacturing facility in Branchburg, roughly 300 employees. It signed LPAs with Local 360 in August 2018, February 2024 and November 2024.
Now it wants those contracts declared voidable at its own option. From the complaint: “Verano did not want any of these terms. Had it been free to do so, it would not have accepted any of them. In fact, it would have signed no LPA at all. It agreed to the LPA and its terms only because it needed an LPA to qualify for and maintain a license under New Jersey law.”
Three theories: “First, it is voidable under duress because it was signed under illegitimate legal coercion. Second, it is voidable under the doctrine of frustration of purpose… Third, it is voidable under the doctrine of mutual mistake…”
Do not overstate the Curaleaf ruling
The engine here is Curaleaf Holdings, Inc. v. N.J. Cannabis Regulatory Comm’n, No. 3:25-cv-16397-MAS-RLS (D.N.J. May 27, 2026), attached to Verano’s complaint as Exhibit A. Coverage of that decision has been sloppy, so be careful.
Judge Shipp found that the plaintiffs had shown a likelihood of success on the merits of their NLRA preemption claim, and separately denied the Commission’s motion to dismiss. That is preliminary-injunction and pleading-stage posture. It is one district judge. It is not a final merits judgment, and it is not Third Circuit precedent. New Jersey’s labor peace mandate has not been struck down. Verano’s own complaint concedes the posture at paragraph 36 even while paragraph 4 characterizes it more aggressively.
Verano also alleges the Commission imposed a $610,000 civil monetary penalty on Curaleaf for failing to maintain an LPA. That figure comes from Verano’s pleading. The New Jersey Monitor reported that spokespeople for both Local 360 and the Commission did not respond to requests for comment — so at this stage you are hearing one side.
Why the union being a defendant is the real story
Most coverage frames this as a licensing fight. It is bigger than that. A multistate operator is asking a federal judge to void a signed collective agreement with a union on duress and mutual-mistake grounds. If that works, every LPA signed under a state mandate anywhere becomes questionable — not just as a licensing condition, but as a contract.
The timing pressure is real: Neptune Township’s license renewal came due August 1 and Mount Holly’s comes due in November. And the choice of counsel tells you what kind of case this is — Keith J. Rosenblatt of Littler Mendelson, a management-side labor firm.
Related coverage: the Senate hemp ban delay and workplace drug testing in 2026.
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We break this down on Cannabis Legalization News with Thomas Howard and Miggy 420.
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