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TheStreet Open House

Pot on Wheels Service Forges Ahead Under City's Scrutiny

NEW YORK (MainStreet) — Although the San Francisco Department of Health is reportedly investigating the Uber-like pot delivery app called Eaze, Randall Nixon is undeterred.

The Silicon Valley entrepreneur is moving forward with plans to launch Moio Direct on September 15.

Read More: Marijuana's Answer to LinkedIn Pairs Job Seekers With Cannabis Employers

"Moio is different from Eaze, because they are employing their own drivers to carry marijuana products, but we are using the delivery infrastructure that already exists at dispensaries, which reduces our liability," Nixon told MainStreet.

Eaze is under scrutiny for allegedly employing drivers to deliver marijuana to medicinal users at their homes.

"It sounds like Eaze operates as a dispensary and that requires a permit," Nixon said. "Moio is not concerned with permits because instead of delivering marijuana we are taking orders for delivery."

A Department of Health spokeswoman named Rachael Kagan told the San Francisco Chronicle that whether Eaze will need a permit is a developing question the Department is currently reviewing.

"Seed to sale tracking systems have been proven to work from a regulatory standpoint in many of the 23 medical marijuana states and very few states with legal programs allow for off-site delivery," said Christie Lunsford, director of operations at 3D Cannabis Center and board member of the Women's CannaBusiness Network. "Concerns about diversion will need to be addressed before large scale delivery services can work consistently."

Companies like Eaze could face federal or state criminal charges and even forfeiture depending on their business model.

"The process will depend upon the regulations in that particular state if those regulations are even applicable," said Matthew Abel, a lawyer with Cannabis Counsel in Detroit and executive director with the National Organization for the Reform for Marijuana Law (NORML) in Michigan.

Read More: Electronic Nose Device Intrigues Cannabis Investor Community

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