Distressed Cannabis Business Sales
Selling or buying a distressed cannabis business
Federal bankruptcy is generally closed to plant-touching cannabis businesses, so distressed sales run through state receiverships, assignments for the benefit of creditors and negotiated sales. These pages cover each path, tax-lien priority, wind-down versus sale, and license surrender.
Federal and state law current as of September 2026 — verify with counsel.
Assignment for benefit of creditors
How a state-law assignment for the benefit of creditors works for a licensed cannabis business, what regulators require of the assignee.
Buying a license out of receivership
What a buyer really gets from a cannabis receiver: as-is assets, a sale order that clears only some liens, and a license the regulator must still approve.
Cannabis receivership sales explained
How a cannabis receivership sale runs from petition to closing: receiver qualification rules in WA, CO, OR, CA, MI and MA, court sale orders, and who gets paid.
License surrender vs transfer
Surrendering a cannabis license is fast and final; transferring it needs regulator approval but can recover value. How each works, with state rule examples.
Selling a cannabis business in distress
No chapter 11, no automatic stay: how owners of struggling cannabis businesses sell fast, keep the license alive, deal with lenders and tax liens.
Tax-lien priority in cannabis sales
Who gets paid first when a cannabis business is sold with IRS and state tax liens: first-in-time rule, IRC 6321 and 6323, state liens, and closing payoffs.
Wind-down vs sale
Should you close a struggling cannabis business or sell it? A decision table, illustrative arithmetic, the orderly wind-down steps, and debts that survive.