Litigants in Alabama’s ongoing medical marijuana litigation will be back in court on Wednesday to seek approval to reboot the awarding of marijuana licenses. The State Legislature passed, and Governor Kay Ivey signed, legislation legalizing medical marijuana in 2021. A number of business entities denied licenses to enter the state’s newest industry have sued over issues surrounding the license awards. Judge James Anderson is hearing those cases in Montgomery Circuit Court.
Last Thursday, the Alabama Medical Cannabis Commission (AMCC) voted on a series of rule changes to address issues that plaintiffs have raised. The AMCC hopes that Judge Anderson will be satisfied with those changes and will allow the state to rescind those previous cannabis awards made by the Commission in June and August.
Southeast Cannabis, which was awarded a license by the Commission in June and then had its award reaffirmed in August, is seeking a temporary restraining order (TRO) on the AMCC’s plan to rescind the awards and reconsider all of the applications.
Judge Anderson last Wednesday dismissed a lawsuit by Verano, who was granted a license award in June and then denied in August, arguing that the license award was a property owned by Verano and, once awarded, could not be rescinded. Anderson ruled against Verano, accepting the AMCC’s position that a license, even though Verano paid the Commission $50,000 for the license, is a privilege and not a right; thus, the Commission does have the authority to rescind Verona’s license. Based on the Verano decision, it seems likely that Judge Anderson will rule against Southeast Cannabis’s request for a TRO.
Alabama Always was denied a permit in the Commission’s June and August meetings. They are suing the state, arguing that the AMCC’s process was flawed and that the Commission violated Alabama’s Open Meetings Act when the commissioners went into a lengthy closed executive session. Other entities denied permits have since joined this litigation, and those suits have been consolidated into one case.
Commission Chairman Rex Vaughn told reporters that, if the court allows, the Commission will rescind the awards and then hold hearings, giving the applicants the opportunity to present their case directly to the Commission. It is hoped that the Commission will be able to grant new awards in either December or January.
The Commission is represented in the litigation by attorney Mark Wilkerson.
Vaughn praised Wilkerson and the legal team representing the AMCC.
“They have been a great asset to us, helping us wade through to where we are. They have done a magnificent job,” Vaughn said.
The Commission has set a meeting for October 26.
The legislation legalizing medical cannabis and creating the AMCC is the most restrictive in the country. The maximum number of marijuana grower, processor, transporter, laboratory, and dispensary licenses that the AMCC can award is limited by the 2021 legislation. The most sought-after license, the integrated facility (which can grow, process, and market cannabis all in-house), is limited to a maximum of five in the state. Due to the strict limits, most applicants will ultimately be denied.
It will be some time well into 2024 before Alabamians with a demonstrated medical need will be able to legally purchase medical cannabis in the state as no crop can legally be planted until final approval is issued from the AMCC, and that can’t happen until the court lifts its hold on the issuing of the licenses.
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