Warrantless Cannabis Regulatory Inspections Upheld Under Burger; As-Applied Challenges Must Exhaust Administrative Remedies

1. Introduction

In Matter of Super Smoke N Save LLC v New York State Cannabis Control Bd. (2026 NY Slip Op 03715), the Appellate Division, Third Department reversed Supreme Court’s grant of a preliminary injunction that had curtailed warrantless inspections of cannabinoid hemp retailers under New York’s Cannabis Law (Marihuana Regulation and Taxation Act) and related regulations.

The petitioners—licensed retailers of cannabinoid hemp products containing less than 0.3% delta-9 THC—brought a CPLR article 78 proceeding seeking to enjoin enforcement of statutory and regulatory provisions authorizing “regulatory inspections,” including inspections undertaken with participation of law enforcement. They asserted Fourth Amendment violations (facial and as-applied) and argued the New York City Sheriff lacked authority to inspect licensed businesses.

The core issues were:

  • Whether the Cannabis Law and implementing regulations provide a constitutionally adequate warrant substitute for warrantless administrative inspections in a closely regulated industry under New York v Burger.
  • Whether petitioners could obtain injunctive relief without exhausting administrative remedies for fact-specific, as-applied claims.
  • Whether the New York City Sheriff has statutory authority to conduct regulatory inspections of suspected cannabis sales where a business may hold some license, but not an “applicable” Cannabis Law license for the product/activity at issue.

2. Summary of the Opinion

The Third Department held that Supreme Court abused its discretion in granting a preliminary injunction. The court concluded:

  • Petitioners failed to show a likelihood of success on a facial Fourth Amendment challenge because the Cannabis Law and regulations, considered together, can be constitutionally applied and meaningfully limit inspector discretion.
  • Petitioners’ as-applied claims were premature due to failure to exhaust administrative remedies available under the regulations (9 NYCRR 133.10–133.24).
  • Supreme Court erred in ruling the New York City Sheriff lacked authority: Cannabis Law § 131 (3) (b) and Administrative Code of City of NY § 7-552 (a) permit inspections of businesses “lacking applicable” Cannabis Law authorization, and “applicable” must be given meaning.
  • Petitioners did not demonstrate irreparable harm, and the equities favored public health and safety enforcement against illegal cannabis sales.

The preliminary injunction was vacated in full.

3. Analysis

3.1 Precedents Cited

Preliminary injunction standards and judicial caution

  • Nobu Next Door, LLC v Fine Arts Hous., Inc. (4 NY3d 839 [2005]) and Matter of New York State Off. of Victim Servs. v Marshall (___ AD3d ___, 2026 NY Slip Op 02184 [3d Dept 2026]): reaffirm the three-part test (likelihood of success, irreparable harm, equities) and frame appellate review as abuse of discretion.
  • Rural Community Coalition, Inc. v Village of Bloomingburg (118 AD3d 1092 [3d Dept 2014]) and Eklund v Pinkey (31 AD3d 908 [3d Dept 2006]): supply the theme that preliminary injunctions are “drastic” and should be issued cautiously because they restrain otherwise lawful conduct before merits adjudication.
  • Camp Bearberry, LLC v Khanna (212 AD3d 897 [3d Dept 2023]): used for the appellate posture—review is limited to whether Supreme Court exceeded/abused discretion as a matter of law.

Facial challenges: the “no set of circumstances” burden

  • United States v Salerno (481 US 739 [1987]) and White v Cuomo (38 NY3d 209 [2022]): anchor the demanding standard for facial invalidation—challenger must show no constitutional applications exist.
  • Matter of Owner Operator Ind. Drivers Assn., Inc. v New York State Dept. of Transp. (40 NY3d 55 [2023]) and Matter of People of the State of N.Y. v Commons West, LLC (__ AD3d __, 2026 NY Slip Op 01253 [3d Dept 2026]): provide New York’s articulation of the “extraordinary burden” for facial challenges and reinforce that a statute survives if it has any valid applications.
  • City of Los Angeles v Patel (576 US 409 [2015]): cited both for facial challenge framing and for the Fourth Amendment requirement of “precompliance review” in certain administrative search regimes.

Administrative searches in closely regulated industries: the Burger framework

  • New York v Burger (482 US 691 [1987]): supplies the controlling three-part test for warrantless administrative inspections in pervasively regulated industries and the requirement that the scheme provide an adequate substitute for a warrant by limiting discretion (time/place/scope).
  • People v Sanders (26 NY3d 773 [2016]): restates the baseline rule that warrantless searches are per se unreasonable absent an exception.
  • People v Rizzo (40 NY2d 425 [1976]): grounds the administrative search exception in legislative judgments about controlling certain commodities/endeavors in the public interest.
  • Canonical “closely regulated” exemplars: United States v Biswell (406 US 311 [1972]) (guns), Donovan v Dewey (452 US 594 [1981]) (mining), Colonnade Catering Corp. v United States (397 US 72 [1970]) (liquor), and the transportation context in United States v Navas (597 F3d 492 [2d Cir 2010]). These cases function as comparative supports for treating cannabis as similarly pervasively regulated.
  • People v Quackenbush (88 NY2d 534 [1996]): used to articulate the “meaningful limitations” requirement on official discretion and to evaluate whether the scheme is limited to what the governmental interest necessitates.
  • Anobile v Pelligrino (274 F3d 45 [2d Cir 2001], amended by 284 F3d 104 [2d Cir 2002], 303 F3d 107 [2d Cir 2002]): cited for the methodological point that courts may consider statutes plus valid agency regulations when assessing facial validity of an administrative search program.
  • Matter of Owner Operator Ind. Drivers Assn., Inc. v New York State Dept. of Transp. (205 AD3d 53 [3d Dept 2022], mod 40 NY3d 55 [2023]): relied on to reject the notion that police presence or discovery of criminal evidence automatically transforms an administrative inspection into an unconstitutional criminal search.

Exhaustion of administrative remedies and the limits of constitutional labeling

  • Town of Oyster Bay v Kirkland (19 NY3d 1035 [2012]) and Matter of Ferris v Grass (219 AD3d 1008 [3d Dept 2023]) and Matter of Guilderland Print., Inc. v New York State Off. of Temporary & Disability Assistance (163 AD3d 1318 [3d Dept 2018]): supply the default rule requiring exhaustion before judicial review.
  • Watergate II Apts. v Buffalo Sewer Auth. (46 NY2d 52 [1978]) and Young Men's Christian Assn. v Rochester Pure Waters Dist. (37 NY2d 371 [1975]): explain why exhaustion matters—avoiding premature judicial interference and allowing agency expertise to shape the record.
  • Matter of Schulz v State of New York (86 NY2d 225 [1995]) and Matter of Haddad v City of Albany (149 AD3d 1361 [3d Dept 2017]): emphasize that merely asserting a constitutional claim does not excuse exhaustion where administrative procedures can provide relief.

Statutory construction used to validate local inspection authority

  • Matter of Anonymous v Molik (32 NY3d 30 [2018]): invoked for the canon against surplusage—statutes should be read so that no word (here, “applicable”) is rendered meaningless.
  • Town of Concord v Duwe (4 NY3d 870 [2005]): used (in the opinion’s footnote) to highlight a tension fatal to facial challenges: if a court can craft constitutionally compliant limitations consistent with the statute, that implies the framework is capable of constitutional application.

Other contextual precedents

  • Matter of Mia S. [Michelle C.] (212 AD3d 17 [2d Dept 2022], lv dismissed 39 NY3d 1118 [2023]): cited for legislative purpose behind legalization and regulation.
  • Matter of West v Alexander (242 AD3d 1407 [3d Dept 2025]): cited for the statutory distinction between defined regulatory inspection locations and inspections that require probable cause.
  • Matter of Independent Ins. Agents & Brokers of N.Y., Inc. v New York State Dept. of Fin. Servs. (39 NY3d 56 [2022]) and Matter of Real Estate Bd. of N.Y., Inc. v City of New York (165 AD3d 1 [1st Dept 2018]): cited to distinguish facial review (“cold page”) from fact-intensive as-applied review.
  • Darwish Auto Group, LLC v TD Bank, N.A. (224 AD3d 1115 [3d Dept 2024]): used to reject reputational/business disruption claims as irreparable harm where they are essentially economic.
  • Matter of Cannabis Impact Prevention Coalition, LLC v Hochul (___ AD3d ___, 2026 NY Slip Op 01573 [3d Dept 2026]): cited for the Legislature’s stated public health and safety goals under Cannabis Law § 2, supporting the equities analysis.
  • Hudson Shore Assocs. L.P. v New York (139 F4th 99 [2d Cir 2025]): used in the footnote to support the proposition that CPLR article 78 may serve as a form of neutral review sufficient to satisfy “precompliance review” concerns.

3.2 Legal Reasoning

A. The court’s central move: reframing the merits inquiry through facial-challenge doctrine

Supreme Court enjoined warrantless inspections after finding the scheme did not satisfy the administrative search exception and was too “criminal” in focus. The Third Department did not accept that framing for purposes of a preliminary injunction because petitioners bore an especially heavy burden: they asserted a facial constitutional challenge, which fails if any constitutional applications exist.

This doctrinal choice mattered. The Third Department emphasized that Supreme Court’s own tailoring of inspection limits (not inconsistent with statute/regulations) implicitly recognized that constitutional applications exist—undercutting facial invalidation (see the opinion’s reliance on Town of Concord v Duwe).

B. Applying Burger’s third prong: adequate substitute for a warrant

Petitioners largely conceded the first two New York v Burger prongs (substantial government interest; necessity of warrantless inspections). The fight was over the third prong: whether the statutory/regulatory framework provides “certainty and regularity” and “meaningful limitations” on discretion (time/place/scope).

The Third Department found that, taken together, the Cannabis Law and regulations cabin discretion sufficiently:

  • Advance notice/consent as a licensure condition: applicants consent to regulatory inspections (9 NYCRR 133.3 [a]).
  • Defined inspection targets and limits: statutory notice that licensees are subject to “regulatory inspections” of defined locations (business premises and vehicles), with inspections beyond those parameters requiring probable cause (Cannabis Law §§ 10 [8]; 11 [3], [5]).
  • No forced entry contemplated by the regulatory mechanism: noncooperation leads to administrative penalties rather than authorized breaking into locked areas (9 NYCRR 133.3 [e]).
  • Time limitation for local inspections: inspections under local law limited to operating hours (Cannabis Law § 131 [3] [b]).
  • Scope constraints: regulations identify categories of products/records/materials subject to examination (9 NYCRR 133.3 [a]; 133.25 [a]).
  • Accompaniment/interviews: regulations specify that inspectors may be accompanied by peace/police officers and identify who may be interviewed (9 NYCRR 133.3 [a]; 133.25 [a]).
  • Seizure authority is enumerated: if violations are discovered, Cannabis Law § 138-a (2) lists what may be seized.

The upshot: even if particular inspections were allegedly abusive, the framework itself was not shown to be unconstitutional in all applications. That defeats facial success and therefore defeats the preliminary injunction’s “likelihood of success” prong.

C. “Pretext” and police participation: administrative searches are not invalid merely because criminal evidence might be found

Supreme Court treated the inspections as impermissibly oriented toward criminal enforcement. The Third Department responded with two points rooted in New York v Burger and Matter of Owner Operator Ind. Drivers Assn., Inc. v New York State Dept. of Transp.:

  • Police participation does not itself make an otherwise lawful administrative inspection unconstitutional.
  • Discovery of evidence of crime during an administrative inspection does not retroactively invalidate the search.

The court also noted the record at argument: inspections had not resulted in criminal convictions and petitioners cited only one arrest that was not prosecuted—undercutting a claim that the program is functionally a criminal dragnet on its face.

D. As-applied claims must be exhausted because they are fact-dependent and administratively remediable

The opinion draws a sharp line: facial review is “on a cold page,” while as-applied review turns on concrete operational facts. Here, the petitioners’ allegations—destruction of lawful products, searches of nonpublic locations, disabling surveillance, participation of unauthorized/untrained officers, and lack of disinterested review—are all operational.

Because OCM regulations provide prompt administrative review (9 NYCRR 133.10–133.24), petitioners’ failure to use those channels was dispositive for preliminary relief on as-applied theories. The court stressed the institutional reasons from Watergate II Apts. v Buffalo Sewer Auth.: agencies must have a chance to build a record and apply expertise before courts intervene.

E. The New York City Sheriff’s inspection authority: “applicable” means something

Supreme Court read Cannabis Law § 131 (3) (b) as barring local inspections of any business with any state-issued cannabis-related license. The Third Department disagreed using classic interpretive tools:

  • The operative phrase is “lacking applicable registrations, licenses or permits.” Reading “applicable” out of the statute violates the canon against surplusage (citing Matter of Anonymous v Molik).
  • Under the general/specific canon (Statutes § 238), a broad reading that immunizes any licensed entity yields to the more specific object: businesses selling cannabis products without an applicable authorization for the activity/product at issue.

The court’s construction is pragmatic: it allows local officials to inspect hemp retailers suspected of selling products exceeding the THC threshold (i.e., cannabis masquerading as hemp), even if the retailer holds some other license not “applicable” to that suspected conduct.

F. Irreparable harm and equities: economic injury is not enough; public health objectives matter

The Third Department found petitioners’ claimed harms (seizures, postings, business disruption, reputational damage) largely remediable through damages or post-deprivation equitable relief after administrative hearings or a later CPLR article 78 proceeding. Under Darwish Auto Group, LLC v TD Bank, N.A., primarily economic harm does not establish irreparable injury.

On equities, the court relied on Cannabis Law § 2 and § 125 (1-b), emphasizing the Legislature’s public health and safety determination that unlicensed cannabis activity “presents a danger.” The court found these public risks outweighed petitioners’ contingent injuries at the preliminary stage.

3.3 Impact

  • Stabilizes warrantless inspection authority in cannabis enforcement: By holding the Cannabis Law/regulatory scheme can satisfy New York v Burger on its face, the decision strengthens the state’s ability to use warrantless administrative inspections as a frontline tool against illegal cannabis sales.
  • Channels disputes into administrative process: The exhaustion holding signals that operational complaints (scope, manner, seizures, officer behavior) should be litigated first through OCM’s hearing and review structure (9 NYCRR 133.10–133.24), not immediately via injunctive article 78 litigation.
  • Bolsters local enforcement participation: The statutory construction of “applicable” licenses supports municipal inspection programs aimed at businesses that may be licensed for some activities but are suspected of selling unlawfully high-THC products.
  • Limits preliminary injunctions against regulatory regimes: The opinion underscores that in constitutional challenges—especially facial challenges—preliminary injunctions are harder to obtain due to the presumption of constitutionality and the need to show likely success under demanding facial standards.
  • Fourth Amendment doctrine in regulated industries: The case fits within a broader trend (reflected by City of Los Angeles v Patel) of scrutinizing administrative search schemes for discretion-limiting features and opportunities for neutral review, while still permitting robust warrantless inspection regimes in closely regulated sectors.

4. Complex Concepts Simplified

  • Facial vs. as-applied challenge: A facial challenge argues a law is unconstitutional in all situations; an as-applied challenge argues it was applied unconstitutionally to a specific party in specific facts. Facial challenges are much harder because if the law can work constitutionally even once, it survives.
  • Administrative search exception: Some heavily regulated businesses can be inspected without a warrant as part of regulatory oversight. The tradeoff is that the inspection program must be tightly structured so inspectors do not have open-ended discretion.
  • The Burger test (New York v Burger): Warrantless administrative inspections are allowed only if (1) the government has a substantial interest, (2) warrantless inspections are necessary, and (3) the program provides a warrant substitute by limiting discretion (time/place/scope and regularity).
  • Exhaustion of administrative remedies: If an agency offers a process to challenge enforcement (hearings/appeals), you generally must use it before going to court—especially when the dispute turns on facts and the agency can create a record and possibly fix the problem.
  • Irreparable harm: Courts grant preliminary injunctions only when harm cannot be adequately repaired later (for example, by money damages). Purely economic losses usually do not qualify.
  • Canon against surplusage (“applicable”): Courts try to interpret statutes so every word has meaning. Here, “applicable license” means a business is not shielded from inspection merely because it holds some license; the license must match the regulated activity/product.

5. Conclusion

Matter of Super Smoke N Save LLC v New York State Cannabis Control Bd. is a significant early appellate statement on how New York’s cannabis enforcement architecture fits within Fourth Amendment administrative search doctrine. The Third Department held that the Cannabis Law and implementing regulations can provide a constitutionally adequate substitute for a warrant under New York v Burger, defeating a facial challenge at the preliminary injunction stage. It also reinforced that fact-intensive, as-applied objections to inspections and seizures must be pursued first through available administrative remedies. Finally, the court adopted a functional statutory construction that preserves local inspection authority where a business lacks an “applicable” Cannabis Law authorization for the suspected conduct.