MENOMINEE, Mich. (WLUK) — A marijuana dispensary has filed a lawsuit against the city of Menominee, Michigan, asking a judge to allow the shop to open and seeking at least $20 million in compensatory damages.

“It was never our intent to become adversarial with the city, and we’re still hopeful that common sense will prevail,” said Nick Hannawa, owner of PUFF Cannabis Company.

Puff Cannabis sues City of Menominee for at least $20 million in compensatory damages (WLUK)

PUFF claims the city approved its license on Dec. 16, 2024, but they have still not been provided with an occupancy permit. The city has cited issues with PUFF’s parking lot and its entrances.

“They should have been open in July. The city delayed their inspection and then improperly refused to give them a final certificate of occupancy,” said PUFF’s attorney, Jennifer Green.

While the city has not formally responded to the lawsuit, Mayor Casey Hoffman told FOX11, “They did everything right. They got all of the permissions they needed to build in the city of Menominee, but the city manager will not give them the final approval they need to open up.”

He added, “They [PUFF] are going to take the city to court, and I predict the city will lose.”

City Councilman Michael DeDamos disagrees.

“Kind of a fatalistic attitude, I would say, from Mayor Hoffman. I’d suggest that we have good legal representation who knows what they’re doing, and to openly suggest that we would lose this lawsuit before it’s even began… It just doesn’t feel right,” said DeDamos.

He added, “We haven’t really gotten in front of the judge yet. We’re hoping that Judge [Mary] Barglind will make a decision that will make every, each party happy. That they’ll maybe put this thing behind us before it ends up costing us any money.”

The dispute comes after Menominee residents have voted twice to cap the number of marijuana establishments in the city at nine. PUFF claims there are only eight shops operating, so there shouldn’t be an issue allowing it to open.

The lawsuit requests a preliminary injunction allowing PUFF to open and unspecified monetary damages. PUFF’s attorney said it would be at least $20 million.

“We’re very confident in the strength of our legal position and, you know, we don’t want to hurt Menominee, but the longer it takes us to open, the more our damages are just adding up and up and up,” said Hannawa.

The expected revenue for the Menominee store is conservatively $3-4 million a month; thus, the City digs its damages hole deeper by roughly $100,000 a day. The best thing it could do would be stop the bleeding and give Puff its license to avoid further damages for lost profits. The citizens may not want another cannabis facility in their town, but I imagine those same citizens also don’t want their taxes to go up to pay for the legal fight as well as any potential judgment Puff may obtain against the City for its monetary damages. $20 million is on the low end… The longer this takes, the higher that number climbs. If no license is issued, the damages that we will seek at trial will be well north of $20 million because we will seek the loss of both past profits as well as future lost profits,” Green said in an email.

PUFF previously offered the city a settlement that would have allowed the dispensary to open without awarding any damages. The city declined that offer.

FOX 11 reached out to City Manager Brett Botbyl via phone for an interview. Later, we sent him an email with the following questions:

• Why refuse the settlement offer that didn’t include any damages being paid to PUFF?
• Are you concerned taxpayers will be subject to more than the $20 million if PUFF is also awarded punitive damages?
• What is your response to Mayor Hoffman openly stating he believes the city of Menominee will lose this suit?

Both the phone call and email were after City Hall closed at 3:30 p.m. Thursday. FOX 11 has not received a response, but we will update this story when we do.