Arkansas high court gives OK to license pot growers

Wednesday, June 27, 2018

The Arkansas Medical Marijuana Commission (AMMC) can proceed with awarding cultivation licenses.

On Thursday, June 21, The Arkansas Supreme Court overturned a ruling by Pulaski County Circuit Court Judge Wendell Griffen, which had declared that Arkansas' process for licensing medical marijuana growers was unconstitutional.

In a decision released by the court, associate justice Rhonda K. Wood says the supreme court reverses and dismisses the appeal submitted by Naturalis Health LLC because the circuit court lacked the jurisdiction to halt the licenses.

In the ruling, Wood says the Arkansas Constitution prevents one branch of government from exercising another branch's power. She says the "judicial branch must not abdicate this by reviewing the day-to-day actions of the executive branch."

In a 28-page order released on March 21, Griffen had issued a preliminary injunction barring the AMMC from issuing the five cannabis cultivation licenses, including one for Osage Creek Cultivation in Carroll County.

Griffen issued a temporary restraining order on March 14, the same day the commission planned to formally award the licenses to the five companies.

Naturalis Health LLC, one of the unsuccessful cultivation applicants, filed the lawsuit challenging the commissionís selection process for evaluating applications for the growing licenses. The lawsuit alleged conflicts of interest, violations of rules and irregularities in the scoring system.

Among the rule violations, Griffenís order states, was a failure by the commission to verify that the primary entrance for any of the 95 cultivation facility applicants was at least 3,000 feet from any public or private school, church or daycare that existed before the date of the applications, as required by the Arkansas Medical Marijuana Amendment of 2016.

Griffen also notes some potential conflicts of interest. The order states that commissioner Travis Story of the MMC has served as both an attorney and an officer in business entities for Jay and Mary Trulove, who have ownership interests in Osage Creek Cultivation.

The order says commissioner Dr. Carlos Roman of the AMMC is a physician who routinely refers patients to Dr. Scott Schlesinger, who holds an ownership interest in Natural State Medicinals Cultivation of Jefferson County.

Roman scored Natural State Medicinals Cultivationís proposal more than 30 points higher than the average score he assigned the rest of the applications. Osage Creek Cultivation tied for the second-highest score among Storyís evaluations.

Attorney General Leslie Rutledge appealed the March 21 ruling, naming the Arkansas Department of Finance and Administration, the Arkansas Alcoholic Beverage Control Division and AMMC as defendants.

In a concurrent opinion released Thursday, chief justice John Dan Kemp says the supreme court "will not rewrite administrative-agency rules, nor will it substitute its judgment and discretion for that of the agency." AMMC has a constitutional duty to adopt rules necessary for its "fair, impartial, stringent and comprehensive administration" of the Arkansas Medical Marijuana Amendment, he says.

Kemp concludes his decision by urging AMMC to review its rules and procedures and to cure any deficiencies.

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