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Court of Appeals considers lawsuit over state’s medical cannabis licenses

ANNAPOLIS — An attorney representing the state’s medical cannabis commission told Maryland’s highest court Thursday that members of an association of marijuana growers and processors should be allowed to intervene in a lawsuit over the issuing of licenses.

The Court of Appeals, following a rare July hearing, will decide whether the association of preapproved medical cannabis growers can intervene in a request for an injunction that could further stop the state’s long-delayed medical marijuana program.

While the judges did not rule following the hearing, some observers said they expect an order in the coming days in advance of a written opinion since state licensing deadlines are less than a month away.

Attorneys for Alternative Medicine Maryland LLC are seeking to overturn the Maryland Medical Cannabis Commission’s awarding of 15 growers’ licenses on the basis that the panel did not provide for racial diversity. Alternative Medicine Maryland is a minority-led company, and none of the 15 licenses that were preliminarily approved went to companies with minority ownership.

The Court of Appeals in early June denied a motion by AMM that sought to keep in place a temporary injunction issued by Baltimore City Circuit Court Judge Barry Williams barring the state’s medical cannabis commission from issuing the 14 additional growing or processing licenses. AMM also asked Williams to revoke the license issued to Stevensonville-based ForwardGro that was issued in May.

“I think where the circuit court went wrong was in focusing on the issue before the court rather than examining what the subject matter of the litigation was,” said Julia D. Bernhardt, deputy chief of the Office of the Attorney General’s civil litigation division, which represents the state commission. “The subject matter of the case is the validity of these 15 preapproved licenses and ForwardGro’s license. That’s what the plaintiffs seek to have declared invalid.”

Bernhardt told the court that Alternative Medicine Maryland is asking the courts for a “do-over” on the licenses — a request that directly affects those companies who are expected to seek final approval to begin operations by Aug. 15.

“The proposed interveners have a direct economic interest — a very substantial and strong economic interest in the subject matter of this litigation,” Bernhardt said.

Speculative harm?

A group of plaintiffs that includes members of the Maryland Wholesale Medical Cannabis Trade Association and potential patients are seeking to intervene in AMM’s lawsuit.

But Byron B. Warnken, an attorney for AMM, told the court that the lawsuit focuses on errors made by the medical cannabis commission and companies that stand to benefit from such errors are barred from joining the case to protect their interests.

“The circuit court got the issue of intervention correct and its ruling should be affirmed,” Warnken said, adding that none of the preapproved licensees has an interest that is not already represented before the courts.

“If permitted to intervene, a dangerous precedent will be set,” said Warnken, of Warnken LLC in Baltimore. “Ultimately, the harm to everyone is completely speculative. (T)here’s no indication that ForwardGro is going to be harmed or anyone else is going to be harmed.

But Arnold M. Weiner, a lawyer for the association of growers and processors, said granting AMM’s injunction would harm businesses that have spent tens of millions of dollars preparing to open their operations in a few weeks.

“There is nothing speculative about the harm that will be caused by an injunction,” said Weiner, of Rifkin Weiner Livingston LLC in Baltimore. “Each of these companies will incur expenses while they’re ability to get income will be delayed.”

Some of the companies awaiting final approval from the commission will lose between $90,000 and $175,000 per month, he added.

“There’s nothing speculative about that,” Weiner said.

The case is Jane and John Doe et al. v. Alternative Medicine Maryland, LLC et al., No. 98 September Term 2016.


An earlier version of this story misspelled the name of the deputy chief of the Office of the Attorney General’s civil litigation division. Her name is Julia D. Bernhardt.

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