MI Monthly Puff: Supreme Court Curbs Cannabis Searches and Probation Bans
Top Headlines This Month
- Supreme Court bars warrantless vehicle searches over marijuana civil infractions
- Supreme Court rules federal illegality alone cannot justify a probation marijuana ban
- 24% wholesale tax brings in just $34M
- Bangor processor surrenders license over Massachusetts shipment allegations
- CRA holds second public hearing on updated marihuana rules
Michigan cannabis Supreme Court rulings dominated July 2026, with two decisions reshaping how police and courts treat marijuana users. At the same time, the state’s 24% wholesale tax is coming in well below projections, a processor lost its license over alleged interstate shipments, and the CRA moved its rule revisions one step closer to final certification. It was a heavy month for the legal and regulatory backbone of Michigan’s cannabis market.
Michigan: Supreme Court Bars Warrantless Vehicle Searches Based on Marijuana Civil Infractions
The Michigan Supreme Court issued a 5-2 ruling on July 22, 2026 in People v. Wilkins, holding that police cannot conduct a warrantless vehicle search based solely on evidence of a marijuana-related civil infraction. The case began with a January 16, 2023 traffic stop in Kent County, where State Police Trooper James Tompkins stopped Freddie Wilkins III for speeding, smelled marijuana, and determined both occupants were younger than 21. Under Michigan law, possession of 2.5 ounces or less of marijuana by someone under 21 is a civil infraction, not a criminal offense. Writing for the majority, Justice Kimberly Ann Thomas concluded that probable cause to believe only a civil infraction occurred does not justify a warrantless search under the automobile exception to the Fourth Amendment. The court reversed the Michigan Court of Appeals, which had upheld the search on the grounds that marijuana possessed by someone under 21 qualified as contraband sufficient to trigger that exception. Justices Brian Zahra and Richard Bernstein dissented. The ruling extends a legal shift the court started with its 2025 decision in People v. Armstrong, which overturned the long-standing rule that marijuana odor alone establishes probable cause to search a vehicle. Together, these decisions raise the evidentiary bar Michigan law enforcement must clear before searching a vehicle in connection with marijuana, directly affecting how traffic stops involving cannabis are handled statewide.
Michigan: Supreme Court Rules Federal Illegality Alone Cannot Justify Banning Marijuana Use on Probation
The Michigan Supreme Court ruled unanimously on July 6, 2026 in People v. Hess that state trial courts cannot prohibit MRTMA-compliant marijuana use as a condition of probation solely because such use violates federal law. The court held that Michigan’s Regulation and Taxation of Marihuana Act provides that compliant marijuana use shall not be grounds for arrest, prosecution, penalty, search, or the denial of any right or privilege, and that the MRTMA controls when it conflicts with state laws, including the probation act. The case involved Danielle Heaven-Leah Hess, who pleaded guilty to third-degree retail fraud in August 2021 and was sentenced to one year of probation that included a marijuana use prohibition. She tested positive for marijuana twice in 2022, generating two probation violations. The Supreme Court reversed the lower court decisions and remanded the case for reconsideration of her probation terms, with direction to vacate her first violation and dismiss her second. The ruling applies only to state court probation sentences and not to those handed down in federal courts. Importantly, the court expressly declined to decide whether a trial court may still restrict a probationer’s marijuana use as a discretionary, individually tailored condition, leaving that question for a future case. The decision narrows the grounds available to lower courts, which can no longer rely on federal illegality by itself, but it does not bar every marijuana-related probation condition in Michigan.
Michigan: 24% Wholesale Marijuana Tax Falls Short of Early Revenue Projections
Michigan’s 24% wholesale marijuana tax took effect January 1, 2026 and was projected to generate $420 million annually for local road projects. In the first months of the year, the state collected just $34 million from the tax, well short of the pace needed to reach that figure. Cannabis Regulatory Agency data shows flower sales volume and overall adult-use sales revenue declined compared to the same period in 2025. Flower prices fell to near historic lows and vape prices remained near historic lows, even as vape cartridge sales volume grew. Wholesalers, growers, and processors appear to be absorbing the tax rather than passing it to consumers, keeping retail prices essentially flat. The Michigan Cannabis Industry Association has filed two lawsuits challenging the tax: one arguing it required a three-fourths supermajority to pass because it effectively amended the voter-approved 2018 legalization law, and another claiming it constitutes unconstitutional tax pyramiding. State officials have cautioned that it is too early to judge the tax and have warned against annualizing first-quarter results, noting that early collections may partly reflect post-implementation distortions, including stockpiling by retailers and hoarding by consumers ahead of the January 1 effective date. Critics in the legislature are less patient, and with two unresolved lawsuits, continued price compression, and a market already running at thinner margins, the tax’s long-term effect on the Michigan cannabis supply chain is still playing out.
Michigan: Cannabis Processor Surrenders License After Alleged Illegal Interstate Product Transport
Michigan cannabis processor Ground Control Michigan, doing business as GCM Waypoint in Bangor, permanently surrendered its adult-use processor license after the Cannabis Regulatory Agency filed a complaint on June 4 alleging the company illegally transported marijuana products to Massachusetts. Massachusetts cannabis regulators discovered Michigan-tagged gummies, vape cartridges, disposable vape products, and infused pre-rolls at a licensed facility there, triggering a multi-state investigation. According to the CRA complaint, the company’s sales manager initially told investigators the products had been picked up in Michigan by a Massachusetts employee, but a separate interview with that employee, who said GCM Waypoint employees had delivered the products to Massachusetts while attending a cannabis trade show, contradicted that account. During a second interview on March 30, the sales manager allegedly admitted he had lied and acknowledged personally transporting 249 marijuana products to Massachusetts in his personal vehicle. A March 11 inspection of the Bangor facility found additional alleged violations, including hundreds of products listed in the state’s Metrc tracking system that could not be located, approximately 317 grams of untagged marijuana biomass, and missing standard operating procedures. The CRA alleged 12 violations in total. The agency entered into two consent orders resolving both formal complaints against the company, including a separate enforcement action No. 26-00320. Under those orders, the company surrendered its license permanently, agreed to cease operations on July 28, and agreed the license can never be renewed or reissued, without admitting the allegations. Michigan operates one of the nation’s most comprehensive seed-to-sale tracking systems, and allegations involving products appearing inside another state’s licensed facility represent a direct challenge to that system’s integrity. The multi-state investigation shows Michigan and Massachusetts regulators are actively cross-referencing tracking data, and the case signals that interstate transport violations carry serious licensing consequences regardless of whether both states have legal cannabis programs.
Michigan: CRA Held Second Public Hearing on Proposed Marihuana Rules
The Michigan Cannabis Regulatory Agency held a second public hearing on July 23, 2026 at its Lansing offices to receive public comment on proposed changes to rule set 2023-25 LR (Marihuana Rules). The hearing addressed revisions made after the first public hearing, which was held on May 6, 2025. Comments were accepted in person, virtually via Zoom, and by email, with a written comment deadline of 5:00 PM on July 24. With that comment period now closed, the CRA’s final rules will be sent to the Legislative Service Bureau for formal certification, and after MOAHR legal certifies them, forwarded to the Joint Committee on Administrative Rules, a bipartisan state legislative committee made up of five members from the Senate and five members from the House. The process reflects more than a year of revision to Michigan’s cannabis regulatory framework since the first public hearing. JCAR review is the final legislative checkpoint, after which the agency files a certificate of adoption and the rules are filed with the Office of the Great Seal before taking effect. This regulatory process is a key aspect of ongoing updates in the Michigan cannabis market.
The Bottom Line
July 2026 delivered two significant Michigan cannabis Supreme Court rulings, a widening gap between wholesale tax projections and actual collections, and a high-profile enforcement action tied to interstate transport. With the CRA’s revised rules heading to JCAR and two tax lawsuits still unresolved, the legal and regulatory foundation of the state’s marijuana market is actively being rewritten.
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