Cannabis Retailer Sues Costa Mesa over Withheld Permit

High Seas Cannabis Boutique Awaits Permit Approval

The High Seas cannabis boutique has been in development for two years. The expansive showroom, formerly a BBQ store and gym, is adorned with large saltwater aquariums, lending an oceanic theme to the elegant interior designed to house cannabis products.

Majority owner and real estate investor, Rachel Xin, saw potential in the 7,215-square-foot property located at 1921 Harbor Blvd. “Understanding the importance of location, we secured this property based on the zoning opportunity for cannabis,” Xin said.

Xin collaborated with Michael Moussalli and Matteo Tabib, co-founders of Se7enLeaf, a licensed cannabis product manufacturer and distributor based in Costa Mesa. In August 2021, they submitted an application to the city’s planning department to get High Seas up and running.

The dispensary was ready for business by September 26, after securing a state retailer license and a use permit from the Costa Mesa Planning Commission. This followed their successful submission of security, parking, and traffic plans, and a building inspector’s approval of $4.5 million in renovations at the site.

However, the final hurdle – obtaining a cannabis business permit (CBP) from the city – proved to be a bigger challenge. “We expected it to take a day or two,” Xin recalled. “We had complied with all city requirements.” Despite their efforts, they received no response from the city.

With the business losing roughly $111,000 each month it remains unopened, and after an investment close to $10 million, Xin and her partners sought legal remedy. On October 18, they filed a petition in Orange County Superior Court, asking for the city to issue the outstanding permit.

Despite presenting their case at a Costa Mesa City Council meeting, they received no relief. City Attorney Kimberly Hall Barlow stated that there were still issues with the application, something Xin disputes, adding that she’s not aware of any legal or criminal issues creating this delay.

Withstanding this final obstacle, Xin remains focused on opening High Seas as soon as possible. “Every day we don’t open, the damage is piling up,” she said. “I want a resolution that benefits all parties – the city, our business, the community, and our employees.”