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The Legality of MMTCs – To Be Determined

A court case challenging the present formula designed by the legislature. MMTCs could simply pro- “statutory give-away”
Florida medical marijuana program has The trial judge agreed with Florigrown. vide parts of the cannabis which created distinct
not only made its way to the Florida The Department of Health was ordered to supply chain. Secondly, the treatment, which usurps
Supreme Court, the Court invited the par- immediately issue to the company a convoluted formula for any real opportunity to any
ties back for even more briefs and oral license to operate as an MMTC because determining the number of company not already pos-
arguments before issuing a ruling. I don’t the whole vertical integration program MMTCs is completely arbi- sessing a license from
recall that happening, previously. It seems was unconstitutional and against the trary. The best arguments, obtaining one. Clearly a
that at least one justice saw an argument intent of the voters, which was to make though, were that low-THC “special”, not ”general” law.
that neither side argued in their initial pre- safe medical cannabis accessible to quali- license holders and rejected I’m no mind-reader, but I
sentations. The case is called Florigrown. fied patients. The court of appeals agreed, applicants were automati- thought that Florigrown
It has had a fascinating journey, and it may as well. It unanimously ruled that the ver- cally issued licenses prior was already going to win
well erase our present “vertical” program. tical system which the Florida legislature to any applications being BY MICHAEL J. LISS, based on the monopoly
When the low-THC law was enacted, enacted was unconstitutional. The considered by the depart- ESQ. argument. I was fascinated
certain criteria were determined by the Department of Health petitioned the ment. With the mathemati- when the court asked for
state to qualify a few growers/vendors in a Supreme Court to determine the constitu- cal formula for licenses to be issued, the the additional briefing. The “special law”
limited program. Some applications were tionality of the vertically-integrated med- only way to get a license was to buy one of issue seems like a “layup” for Florigrown.
submitted by qualified applicants but were ical marijuana program. the unused licenses (“golden tickets”), How can this law not be a “special” law
denied because of the limited number of The Department of Health’s best argu- which the trial court learned had sold for which gives special privilege to lucky tick-
licenses issued. Some were denied because ments to the Florida Supreme Court were as much as $53 million dollars, by a com- et holders? The state’s argument seems
the applicants did not meet the criteria. that the cap on the number of MMTCs pany which had never planted a seed or weak to me, because while “classes” are
After the 2016 constitutional referen- was constitutional and that vertical inte- conducted any other cannabis business formed all the time (such as plumbers,
dum passed, but before the Department of gration was a rational way to make effec- with that license. Florigrown pointed out lawyers or any other licenses trade), there
Health had promulgated rules for the tive the intent of the voters - to make med- that the department, itself, had calculated are not lawyers who get special treatment
industry, a new company called ical cannabis readily available to patients the state’s need for MMTCs to approxi- beyond other lawyers. Here, however,
Florigrown “registered” itself with the in need. In response, Florigrown argued mate 2,000 dispensaries. The argument many of the license holders only hold
department so that when applications that (1) the law which was enacted alters was that by vertically integrating the sys- licenses and aren’t even in the cannabis
were accepted, its place in line would and contradicts the will of the voters, (2) tem, the program was set up to fail by the business. Investors flipping paper for $53
already be saved. The department refused the caps on the number of MMTC licenses legislature, by selecting a few lucky play- million dollars are not situated similarly to
to recognize the “registration” of was arbitrary, (3) that vertical integration ers to reap unnatural rewards, gave MMTCs which have spent endless mil-
Florigrown. Florigrown sued the created illegal monopolies and (4) that the patients fewer choices, less accessibility lions of dollars to run licensed businesses,
Department of Health. law created a special class (those who were and higher prices. and they are not situated similarly to com-
The lawsuit sought a temporary injunc- granted licenses or had applied under the The Supreme Court wanted more. The panies which want to operate but do not
tion from the trial court causing the former law). Court ordered the parties to brief an issue have the opportunity to have an applica-
issuance of a license to Florigrown so that It was at this point, having read the which had not been raised by either party. tion reviewed until some formulaic peak is
it could operate as a “Medical Marijuana briefs, that I was convinced that the jus- The issue is whether the whole program reached, which may never happen.
Treatment Center” (MMTC), claiming tices would rule that a system which was created by a “special law granting a Last month, I wrote that 2022 is likely
that Florida’s program is unconstitutional grants a few winning tickets and excludes privilege to a private corporation.” In to see an adult-use referendum pass. I
because it is impossible for a company everyone else from an industry would be other words, does the vertical integration opine that Florigrown will have an MMTC
which was not grandfathered into the law found unconstitutional for the reasons statute grant rights to particular compa- license prior to that ballot initiative reach-
to obtain a license. The state argued that argued by Florigrown. Firstly, a lawyerly nies which are not afforded to companies, ing the voters, that the system in place will
the program was a rational system of reg- language argument over “or” or “and” generally. The department argued that the be found unconstitutional and that adult-
ulating a limited program, and that it (there is a large difference in interpreting a law allows for “classes” or businesses to use will be legal after the 2022 vote.
would eventually provide licenses to those law depending on which word applies) get particular treatment, just not specific Because, after all, we are a country which
who were not grandfathered, if and when which determines whether MMTCs must businesses. The law is not a “special” law, represents freedom and opportunity for
there were enough patients to meet the be vertically integrated, or whether but a “general” law, uniformly applied, all. Awarding monopolies and preventing
was the argument. competition to the selected few provides
Florigrown responded that this is clear- no freedom or opportunity for those wish-
ly a “special” law in that it creates classes. ing to enter the industry. Special law likely,
Those who automatically got licenses but one way or another, I believe the
without any review by the department, Supreme Court is about to rule that the
and all other companies, which in reality system we are just starting to get used to is
will never have applications reviewed, due unconstitutional.
to the cap on the number of MMTCs.
While the department argued that the only Michael Liss, Esq. can be reached at
restriction was a “grandfather clause” for ml@integritycounselpa.com or
Florida’s Resource for the former licensees and applicant, (561) 981-2507, located in Boca Raton.
Medical & Business CONTRIBUTING WRITERS Florigrown argued that this was simply a
Daniel Casciato
Cannabis Developments Barbara Fallon

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Boca Raton, FL 33481-2708 Lois Thomson

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34 August 2020 cannabisnewsflorida.com Cannabis News Florida