NEW YORK (MainStreet) - Nestdrop, a smartphone app that facilitates marijuana deliveries between dispensaries and medical patients, was ordered to stop operating in Los Angeles right before Christmas last year. The company claims to be the first mobile app to allow medical marijuana patients the freedom to select medical marijuana from a registered collective or dispensary online and have it delivered to their door in under an hour.

City Attorney Mike Feuer argued on behalf of L.A. that the service violates a municipal ordinance covering dispensaries across the city. That said, in a radical change from the recent past, the city chose to sue the company rather than seeking criminal charges. It also remains unclear whether the provision the company has been accused of violating -- the so called Proposition D regulating the city's dispensaries -- does, in fact, apply to the company.

As a result, Nestdrop has vowed to fight the decision.


WATCH: More personal finance videos on MainStreet | More videos from Lauren Lyons Cole

View Today’s Auto Loan Refi Rates

Michael Pyncher, co-founder of Nestdrop told MainStreet that the company does not understand the city's actions.

"The judge gave no summary," Pyncher said. "The City Attorney claims delivery is not permitted by Prop D. Though anyone who chooses to read Proposition D would see that it explicitly grants immunity to medical marijuana businesses permitting them to deliver. It says delivery and vehicles throughout the bill. Hence, we intend to appeal the injunction. The city has an obligation to uphold the law as it is written."

For now, the company is not in operation but remains optimistic about their chances of overturning this legal hurdle in L.A. and beyond.

"We are confident in what we are doing and expect to be able to service L.A. residents in the near future," said Pyncher. "This is something we would hope cities would find useful as the app can dictate that everything is done legally and openly. It should be embraced by not only consumers but by city officials as well."

In an irony not lost on Pyncher either, the city appears to have tried to regulate out of existence precisely a kind of service that municipalities could one day come to rely on.

 "There's a lot at stake and this case could set a precedent for the future of this industry," he said. "If cities and states want to be able to have this industry done professionally and credibly, they will have to allow the technologies to support this fast growing industry to do so. In the meantime, we are expanding beyond Los Angeles. There's an opportunity to turn a new leaf and we intend to do so. We knew there would be hurdles, but the goal is still in sight."

For one thing, this kind of automated solution might be the answer, particularly for medical users, in every state with drugged driving laws. Nestdrop's founders know this too. As Pyncher said, "We intend to ride this storm."

--Written by Marguerite Arnold for MainStreet