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Bill

S 8951

Prohibits cannabis inversion

2025 Regular Session Introduced by Jeremy Cooney and 4 co-sponsors

The bill prohibits cannabis inversion, strengthens penalties for illicit supply chain activity, and protects whistleblowers to safeguard New York’s licensed cannabis market.

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Bill Summary · S 8951

Summary of Bill S. 8951 (2025-2026) — New York

Main purpose and intent

This bill, titled the “cannabis supply chain integrity and anti-inversion act,” aims to protect the integrity of New York’s regulated cannabis market. It defines and prohibits “cannabis inversion”—the introduction of illicit cannabis into the licensed supply chain—and establishes penalties, license consequences, and whistleblower protections to deter and punish inversion and related misconduct.

Key provisions and changes

  • Definition and scope

    • Introduces term “cannabis inversion” (Section 125-a).
    • Prohibits registrants, licensees, permittees, and laboratory testing facilities (and their agents) from engaging in cannabis inversion.
    • Defines “illicit cannabis” as cannabis products with unpaid taxes, sourced from unlicensed/unauthorized parties, or with misrepresented origin, cultivation site, manufacturing process, or chain of custody.

  • Illicit cannabis offenses (amended Section 136)

    • Expands illicit cannabis offenses to include:
    • Use of fraudulent or unreliable certificates of analysis.
    • Falsification or omission of inventory, testing, transfer, or tracking records.
    • Knowingly selling or transferring inverted (illicit) cannabis to registrants, licensees, or permittees.
    • Establishes various penalties for possession, barter, exchange, or transfer of illicit cannabis by licensees or those who knowingly permit illicit cannabis on premises (class B misdemeanor or related penalties).

  • Penalties and enforcement (new Section 125-a)

    • Civil penalties: at least the greater of three times the retail value of inverted cannabis or $250,000 per violation.
    • Seizure and forfeiture: inverted cannabis and related proceeds may be seized and disposed of per law/regulation.
    • Immediate suspension authority: the Office may suspend pending investigation; if inversion is found knowingly or recklessly, revocation is presumed appropriate.
    • Additional penalties for fraudulent certificates of analysis tied to inversion: permanent revocation of laboratory permits and civil penalties as above.

  • Responsible persons (defined)

    • Defines “responsible person” (e.g., principal officer, managing member, general partner) who can be held liable for civil penalties if they knew or should have known about inversion and failed to act.

  • Whistleblower protections (new Section 138-c)

    • Prohibits retaliation against employees or contractors who report suspected prohibitions/restrictions.
    • Retaliation itself constitutes an independent violation and is subject to discipline and civil penalties.

  • Effective date and rulemaking

    • Act takes effect 180 days after becoming law.
    • Allows immediate regulatory actions necessary to implement the act.

Who would be affected

  • Regulated cannabis licensees, registrants, permittees, and laboratory testing facilities, and their contractors.
  • Owners, operators, and managers who exercise control over licensed activities (as “responsible persons”).
  • Employees or contractors who report suspected inversion (protected by whistleblower provisions).

Procedural/timeline notes

  • Referred to Investigations and Government Operations; amended and recommitted as part of the legislative process.
  • If enacted, state regulators would implement related rules and enforcement procedures on or before the 180th day after enactment.

Overall, the bill strengthens oversight of the regulated cannabis supply chain, tees up substantial penalties for inversion, and provides protections to encourage reporting of suspected illicit activity.

Compiled from official sources — confirm details with the bill’s official record.

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