The Fight Against New York’s METRC Monopoly Heats Up

There is a growing fear among New York cannabis operators that the lawsuit challenging Metrc’s Retail ID program will “kill track and trace” and return the state to the chaos of inversion and inventory failures experienced last year.

That fear is understandable. It is also wrong.

Retail ID is not track-and-trace. Retail ID is a financing mechanism, and understanding how we arrived at this makes that clear.

New York did not design its cannabis compliance system around Metrc.

The original seed-to-sale contract was awarded to BioTrack, whose system—like every other mature cannabis jurisdiction—tracked cannabis at the lot and batch level, not the individual retail unit. BioTrack’s New York implementation was fully digital and did not rely on physical RFID-based identifiers.

Under that contract, BioTrack was permitted to charge $0.10 per digital identifier, explicitly tied to:

lots, batches, and packages.

That $0.10 was understood to be a cost-recovery fee, intended to help maintain servers and software—not a profit center and not a tax on every gram sold. BioTrack bid and won the contract on that basis.

Then BioTrack exited the market, and Metrc acquired the New York contract.

This is the inflection point that matters.

 

Metrc was and is a batch-based company.

In 2024, Metrc announced a new product, Retail ID, a unit-level serialization layer that immediately faced resistance nationwide and has not been successfully rolled out at scale anywhere. New York is the first—and only—state where Retail ID has been made mandatory. Functionally, New York is the test market.

When Metrc stepped into the New York contract, it inherited a system with three immovable constraints:

The digital ID fee was capped at $0.10, Physical tag markups were restricted, and the state did not fund ongoing system operations.

At the same time, Metrc introduced physical RFID tagging to a system that had none before. This created a new vendor choke point that did not exist under BioTrack and introduced significant operational and logistical burdens for license holders.

Critically, Metrc could not charge its usual rate for physical RFID tags. The $0.10 fee likely covers little more than manufacturing cost—if that—while licensees pay shipping and handling. The limited contract funding tied to the original bid was nowhere near sufficient to operate a physical-tag-based system at New York’s scale.

The contract, as written and priced, is not economically viable.

Retail ID was the escape hatch.

By pushing a reinterpretation of New York’s pre-established regulatory definitions—specifically expanding “lot” and “batch” to include individual retail units—Metrc could claim it was merely providing the same digital identifier BioTrack once provided, while “giving away” the physical RFID tag. In reality, this reinterpretation transformed the $0.10 digital ID from a marginal cost-recovery fee into the primary revenue driver of the entire contract, multiplied by hundreds of thousands or millions of units.

Retail ID did not emerge from a safety study. It did not follow a recall failure. It was not demanded by law enforcement.

It emerged because the contract could not otherwise be made to work.

 

Track-and-Trace Worked Before Retail ID — and It Still Can

This is the point most operators need to hear clearly:

Track-and-trace does not depend on Retail ID.

Track-and-trace has always relied on:

batch integrity, package custody, transfer manifests, physical segregation, and audits.

That is how recalls work in every other state. That is how they worked in New York before Retail ID. That is how they will work if Retail ID is removed.

The inversion and inventory failures New York experienced six months ago were caused by:

system transition instability, naming and syntax enforcement errors, and vendor rollout failures.

Retail ID did not prevent those failures. It arrived after them.

 

Recalls are population-based.

You recall a batch because it shares:

inputs, time, conditions, or contamination risk.

Retail ID atomizes that population into millions of individual records that must later be reassembled during a recall.

That is not precision. That is friction.

If Retail ID were removed tomorrow, New York would still be able to:

identify affected batches, identify where they were shipped, identify which dispensaries sold them, and execute recalls faster, not slower.

Retail ID adds no recall capability beyond what batch-level tracking already provides.

 

Even if New York paid every penny of Metrc’s fees tomorrow, Retail ID would still be devastating.

Because the real cost is human labor.

Retail ID:

multiplies scan events, multiplies error surfaces, multiplies reconciliation work, multiplies training burden, and multiplies audit exposure.

This system inherently favors:

large, automated operators, conveyor lines, machine vision, and robotics.

It punishes small businesses, craft producers, and labor-driven operations—the very people New York legalization was supposed to protect.

 

Retail ID was announced nationally in 2024. It encountered immediate resistance and has not been successfully deployed at scale elsewhere. In New York, it was made mandatory.

That reality explains:

inconsistent guidance, missing or incomplete SOPs, shifting interpretations, and trial-and-error compliance with real inventory at stake.

In most industries, pilot programs are:

voluntary, limited in scope, and subsidized by the vendor.

Here, license holders are paying—in money, labor, and risk—to validate a system still being operationally proven.

That is not implementation. That is field testing.

Retail ID also fundamentally changes who bears the cost of regulatory infrastructure.

Under this model, license holders:

pay per identifier, absorb the labor of scanning and reconciliation, and generate the data that gives the system its value.

That data:

trains workflows, validates assumptions, improves vendor tooling, and enables future monetization.

In effect, New York licensees are:

financing the system, operating it, debugging it, and supplying its data exhaust—

all while having no ownership stake, no pricing power, and no ability to opt out.

This is not a public utility model. It is private infrastructure built on compulsory participation.

 

This lawsuit does not threaten public safety. It does not threaten compliance. And it does not threaten track-and-trace.

It challenges a system that forces license holders—especially small businesses—to subsidize a private vendor’s economic shortfall through:

per-unit fees, uncompensated labor, and coerced participation.

If Metrc cannot operate under the contract that was bid and awarded, the solution is not to quietly redefine compliance.

The solution is for New York State to fund its own regulatory infrastructure transparently, as other states do.

But even that is not enough, because even a free Retail ID system would still destroy small operators through labor.

 

New York has two options:

Keep Retail ID

Accelerate consolidation Crush small operators Expand compliance labor Centralize data in a private vendor

Remove Retail ID

Preserve track-and-trace Restore batch-based recall Reduce labor burden Protect small businesses

There is no third option that works.

 

Retail ID is not about safety. It is not about recalls. It is not about diversion.

It is about who pays—and how quietly.

If you care about:

workable compliance real recallability small and mid-sized operators and a sustainable legal market

This lawsuit deserves your support.

To learn more, ask questions, or get involved, email:  nystrackandtrace@gmail.com

Fear thrives in confusion. This lawsuit exists to replace confusion with facts. More than 20 license holders have already committed to the suit. What are you waiting for?

 

Listen to more of Jason’s insights on the New York market in his interview with the Innovating Cannabis Podcast.