Ron Strider
Well-Known Member
A company bumped out of consideration for one of Ohio's 12 large medical marijuana cultivator licenses in favor of lower-scoring minority-owned companies filed suit against the state Wednesday.
PharmaCann Ohio, LLC wants the court to order the Ohio Department of Commerce to award licenses to the top-scoring applicants, including PharmaCann, and is seeking a temporary order to stop the department from issuing provisional licenses to the two minority-owned companies.
The lawsuit was the first filed challenging the results of a months-long, expensive process of applying for a limited number of grow licenses. At least one other losing applicant has said it plans to sue the state.
The complaint, filed in Franklin County Common Pleas Court, challenges the state's "racial quota" for awarding medical marijuana business licenses under the equal protection clause of the Constitution. It does not dispute the state's application scoring process, which has come under fire since license winners were announced Nov. 30.
"This program should be about patients, not lawsuits," PharmaCann policy director Jeremy Unruh said in a statement. "We aren't asking the court to hold up awarding licenses to the ten groups who put up the best scores."
The commerce department declined to comment on the lawsuit.
PharmaCann scored 158.56 points in a competitive application scoring process, ranking 12th of eligible applicants. Parma Wellness Center, LLC and Harvest Grows, LLC scored less than PharmaCann, ranking 14th and 23rd, respectively.
Ohio's medical marijuana law requires state regulators to issue at least 15 percent of medical marijuana business licenses to companies that are majority owned or operated by members of the following "economically disadvantaged" groups: African-Americans, American Indians, Hispanics or Latinos, or Asians. After applications were scored, the Department of Commerce awarded licenses to Parma Wellness and Harvest Grows to satisfy that requirement.
Attorneys for PharmaCann wrote in its complaint that lawmakers added the minority language without examining whether such a set-aside was necessary. Minority set-asides have been upheld by courts when narrowly tailored and backed by strong evidence of discrimination.
The complaint notes the law excludes economically disadvantaged groups such as disabled Vietnam veterans, Appalachian whites and Hasidic Jews.
"Our company values diversity and inclusion. Remedying the effects of past discrimination is a worthy goal of the Ohio legislature," Unruh said. "In this case, however, there simply is no basis in evidence that economic disparity exists in an industry that itself doesn't yet exist in Ohio."
PharmaCann, based in Illinois, has medical marijuana operations in five states.
Ohio is the only state to have written a minority set-aside into its medical marijuana law. The law allows people with one of 21 medical conditions to buy and use marijuana if recommended by a physician.
State regulators decided to initially award only 24 medical marijuana cultivator licenses -- 12 for up to 25,000 square feet of grow space and 12 for up to 3,000 square feet -- and award them through a competitive application process. Large growers each paid a nonrefundable $20,000 application fee.
The complaint also alleges the two minority license winners were not truly economically disadvantaged because they were able to pay the application fee and had $750,000 in an escrow account or surety bond.
From application to operator license, the complaint states, a large-scale cultivator will invest about $15 million dollars into its facility.
News Moderator: Ron Strider 420 MAGAZINE ®
Full Article: Medical marijuana company sues Ohio over cultivator license 'racial quota' | cleveland.com
Author: Jackie Borchardt
Contact: Cleveland.com Contact Us
Photo Credit: Getty Images
Website: Cleveland OH Local News, Breaking News, Sports & Weather - cleveland.com
PharmaCann Ohio, LLC wants the court to order the Ohio Department of Commerce to award licenses to the top-scoring applicants, including PharmaCann, and is seeking a temporary order to stop the department from issuing provisional licenses to the two minority-owned companies.
The lawsuit was the first filed challenging the results of a months-long, expensive process of applying for a limited number of grow licenses. At least one other losing applicant has said it plans to sue the state.
The complaint, filed in Franklin County Common Pleas Court, challenges the state's "racial quota" for awarding medical marijuana business licenses under the equal protection clause of the Constitution. It does not dispute the state's application scoring process, which has come under fire since license winners were announced Nov. 30.
"This program should be about patients, not lawsuits," PharmaCann policy director Jeremy Unruh said in a statement. "We aren't asking the court to hold up awarding licenses to the ten groups who put up the best scores."
The commerce department declined to comment on the lawsuit.
PharmaCann scored 158.56 points in a competitive application scoring process, ranking 12th of eligible applicants. Parma Wellness Center, LLC and Harvest Grows, LLC scored less than PharmaCann, ranking 14th and 23rd, respectively.
Ohio's medical marijuana law requires state regulators to issue at least 15 percent of medical marijuana business licenses to companies that are majority owned or operated by members of the following "economically disadvantaged" groups: African-Americans, American Indians, Hispanics or Latinos, or Asians. After applications were scored, the Department of Commerce awarded licenses to Parma Wellness and Harvest Grows to satisfy that requirement.
Attorneys for PharmaCann wrote in its complaint that lawmakers added the minority language without examining whether such a set-aside was necessary. Minority set-asides have been upheld by courts when narrowly tailored and backed by strong evidence of discrimination.
The complaint notes the law excludes economically disadvantaged groups such as disabled Vietnam veterans, Appalachian whites and Hasidic Jews.
"Our company values diversity and inclusion. Remedying the effects of past discrimination is a worthy goal of the Ohio legislature," Unruh said. "In this case, however, there simply is no basis in evidence that economic disparity exists in an industry that itself doesn't yet exist in Ohio."
PharmaCann, based in Illinois, has medical marijuana operations in five states.
Ohio is the only state to have written a minority set-aside into its medical marijuana law. The law allows people with one of 21 medical conditions to buy and use marijuana if recommended by a physician.
State regulators decided to initially award only 24 medical marijuana cultivator licenses -- 12 for up to 25,000 square feet of grow space and 12 for up to 3,000 square feet -- and award them through a competitive application process. Large growers each paid a nonrefundable $20,000 application fee.
The complaint also alleges the two minority license winners were not truly economically disadvantaged because they were able to pay the application fee and had $750,000 in an escrow account or surety bond.
From application to operator license, the complaint states, a large-scale cultivator will invest about $15 million dollars into its facility.
News Moderator: Ron Strider 420 MAGAZINE ®
Full Article: Medical marijuana company sues Ohio over cultivator license 'racial quota' | cleveland.com
Author: Jackie Borchardt
Contact: Cleveland.com Contact Us
Photo Credit: Getty Images
Website: Cleveland OH Local News, Breaking News, Sports & Weather - cleveland.com
