The Dispensary Wars: Part 1

Inside Hawaiʻi’s Cannabis War: How Eight Licensed Dispensary Companies, Act 269, Political Influence, and a Crackdown on Hemp Businesses Reshaped the State’s Cannabis Industry

THE DISPENSARY WARS

Part 1: The Hateful Eight

An investigation into how Hawaiʻi’s licensed cannabis industry responded when competition began taking its customers—and what its own workers are now revealing about the system those companies were defending.

There is a version of the past two years in which nature simply took its course and Hawaiʻi’s licensed cannabis companies lost fair and square.

Eight companies hold every dispensary license the state had issued. In this version, just as in reality, they had the regulators, the patient registry, the political access, and an entire legal structure built around them, yet customers still left for hemp stores that stayed open later, required no doctor or state card, and sold products Congress made federally lawful in 2018.

In December 2025, a report commissioned by the Department of Health quantified the loss: hemp retailers had captured approximately 31 percent of Hawaiʻi’s combined cannabis and hemp market. Experts assert that the number is even much higher in reality!

That is the version in which the licensed companies accepted the verdict of the marketplace and learned how to compete.

But unlike reality, that is unfortunately not what happened. These entities could not accept things as they were and chose not to react as they morally, lawfully, and ethically should!

Where the War Reached Me

I built Oʻahu Dispensary and Provisions openly. We paid taxes, obtained insurance, employed local workers, and operated under the federal hemp framework Congress created through the 2018 Farm Bill.

Then Hawaiʻi enacted Act 269, attaching criminal penalties to the state’s hemp regulations, including potential prosecution, seizure, forfeiture, and destruction of inventory.

Congress had removed hemp from the Controlled Substances Act. Hawaiʻi responded by applying a different standard and placing the threat of handcuffs behind it. The same product could be lawful elsewhere and treated as contraband in Honolulu.

So I sued. In Alyas v. Lopez, a federal judge is now deciding whether Hawaiʻi can criminalize what Congress legalized. Before the court ruled, the state announced that enforcement would begin on July 1, 2026.

The state did not need to padlock our doors to inflict damage. Once the government declares that products may be seized and their sellers prosecuted, inventory becomes commercially toxic. Customers retreat, employees fear for their jobs, suppliers hesitate, and banks and landlords begin treating the business as though it may not survive.

We removed the disputed products, closed temporarily as a protective measure, and later reopened with inventory compliant with the state’s demands.

That was where the war reached me.

The Eight

Eight licensees do not constitute an open industry. They constitute a state-protected market.

When hemp businesses captured nearly one-third of that market, the licensed companies faced a choice. They could lower prices, improve access, extend their hours, and compete.

Or they could change the law.

This series follows the documentary record of which option was chosen.

On February 27, 2025, Rep. Scot Matayoshi, the chairman of the Hawaiʻi House Consumer Protection and Commerce Committee emailed Karlyn Laulusa, the chief executive of Noa Botanicals, one of the eight licensed companies, about pending legislation:

“The bill I developed with you is still moving.”

That sentence is not rumor. It is a public record produced by the government under Hawaiʻi’s open-records law. It is also not the language of a legislator merely receiving public testimony. It is the language of collaboration: a committee chairman describing legislation he developed with the executive of a company that stood to benefit when the law was later directed at competing hemp businesses.

That legislation became Act 269.

Public records also show attorney Paul Alston forwarding lists of hemp businesses to the office of Attorney General Anne Lopez. The state’s chief legal office was receiving organized information identifying participants in the competing market.

I am not interested in burying the significance of those records beneath polite language. They suggest that companies losing market share sought government power against competitors they could not defeat through ordinary commerce.

And Noa is not even the entire story. It is simply the company whose correspondence is presently the best documented. Hawaiʻi has eight licensed cannabis companies, all confronting the same 31 percent loss and all benefiting from the same restricted system.

Then the Workers Began Calling

The licensed companies controlled the licenses, the public narrative, and much of the political access. What they did not control were the people who worked inside their facilities.

Those workers are talking. And quite a bit!

Current and former employees have described an industry far removed from the clean, tightly regulated image presented to the public and press.

Misconduct, abuse, theft, lies, unsanitary practices, collusion, corruption. These vile actions and practices, and more, are just the mere tip of the iceberg!

By the way, that’s only from one source, and reflecting one experience at one recent point in time.

We’ll delve into that one, and many, many more, in the rest of this series!

Lance Alyas

Oahu Dispensary and Provisions