Judge halts clos­ing of 98 med­i­cal pot firms

In­junc­tion comes against state’s new mar­i­juana rules amid push for li­cens­ing

The Detroit News - - News - BY BETH LEBLANC The Detroit News

Michi­gan Court of Claims Judge Stephen Bor­rello is­sued an in­junc­tion Thurs­day against the state’s new med­i­cal mar­i­juana rules that would have re­sulted in the clo­sure of 98 med­i­cal mar­i­juana fa­cil­i­ties in Michi­gan.

Bor­rello’s brief rul­ing or­dered the state to ex­tend the dead­line to Dec. 15 for all fa­cil­i­ties tem­po­rar­ily op­er­at­ing un­der emer­gency rules and stop “treat­ing tem­po­rar­ily op­er­at­ing med­i­cal mar­i­juana busi­nesses dif­fer­ently based on whether the busi­ness filed a Step 2 ap­pli­ca­tion more than 90 days in the past.”

The state on Tues­day is­sued emer­gency rules that barred some tem­po­rar­ily op­er­at­ing fa­cil­i­ties from do­ing busi­ness af­ter Satur­day if those busi­nesses had not filed a fi­nal, sec­ondary ap­pli­ca­tion by June 15.

The in­junc­tion — is­sued in re­sponse to a claim filed by at­tor­ney Denise Pol­li­cella on be­half of Mon­trowe LLC — came as some med­i­cal mar­i­juana pro­vi­sion­ing cen­ters pleaded with the state to re­con­sider its new emer­gency rules that would force their shut­down. They ar­gued that mu­nic­i­pal de­lays pre­vented their fil­ing of ap­pli­ca­tions by June 15.

Lans­ing Mayor Andy Schor wrote Gov. Rick Sny­der Wed­nes­day, ask­ing him to is­sue new emer­gency rules be­cause the city had yet to is­sue the forms lo­cal dis­pen­saries need to sub­mit a com­plete ap­pli­ca­tion to the state.

“As such, many tem­po­rar­ily op­er­at­ing busi­nesses through­out our com­mu­ni­ties and the state will be forced to shut­ter, leav­ing many em­ploy­ees job­less and many med­i­cal mar­i­huana pa­tients with­out re­li­able ac­cess to the sub­stance that pro­vides them pal­lia­tive re­lief from their de­bil­i­tat­ing med­i­cal con­di­tions,” Schor wrote.

In a state­ment is­sued prior to the judge’s rul­ing, a Sny­der spokes­woman said the gov­er­nor ap­pre­ci­ated Schor’s in­put, “but does not plan to is­sue a new emer­gency rule at this time.” The Depart­ment of Li­cens­ing and Reg­u­la­tory Af­fairs ear­lier Thurs­day said it was eval­u­at­ing con­cerns it re­ceived about

the new rules.

Hun­dreds of ex­ist­ing pro­vi­sion­ing cen­ters were given a break ear­lier this year when the state is­sued emer­gency rules al­low­ing them to con­tinue op­er­at­ing while seek­ing a state li­cense.

Busi­nesses that filed a prequalification ap­pli­ca­tion by Feb. 15 could con­tinue op­er­at­ing with­out a li­cense through June 15 un­der the ini­tial rules. That dead­line later was pushed to Sept. 15, then Dec. 15. Only those busi­nesses that had filed an ini­tial ap­pli­ca­tion by Fe­bru­ary and a fi­nal, sec­ondary ap­pli­ca­tion by June 15 would be able to con­tinue op­er­at­ing past Satur­day. The ex­ten­sion meant that about 108 ap­pli­cants could con­tinue op­er­at­ing.

In her mo­tion for an in­junc­tion, Pol­li­cella said Mon­trowe LLC, a Jack­son area dis­pen­sary, would have to di­vest $500,000 worth of prod­uct by Sun­day to com­ply with the rules. The com­pany, which filed its sec­ondary

ap­pli­ca­tion on Aug. 16, said the state’s retroac­tive rules re­quir­ing the ap­pli­ca­tion to be filed prior to June 15 vi­o­lated its due process and would lead to ir­repara­ble harm.

“The only ra­tio­nale for the im­ple­men­ta­tion of this rule is for it to be an at­tempt to close as many fa­cil­i­ties as pos­si­ble in one ac­tion,” Pol­li­cella wrote.

Pro­vi­sion­ing cen­ters ear­lier Thurs­day also ar­gued that the state did not clar­ify the role the June 15 dead­line would play in fu­ture emer­gency rules. Even if it did, many ap­pli­ca­tions submitted be­fore that day would have been in­com­plete as some cities had not yet started is­su­ing re­quired forms that con­firmed lo­cal or­di­nance and zon­ing ap­provals, said Paula Givens, a cannabis lawyer rep­re­sent­ing sev­eral pro­vi­sion­ing cen­ters.

Detroit and Flint didn’t have or­di­nances on the books at the time so they couldn’t sign at­tes­ta­tion forms in­di­cat­ing oth­er­wise, Givens said. Lans­ing had adopted a lo­cal or­di­nance by June 15, but has yet to is­sue any of the lo­cal ap­proval forms re­ferred to as At­tes­ta­tion I.

Many ap­pli­cants were led to be­lieve they couldn’t ap­ply with­out those forms be­cause their ap­pli­ca­tions would be in­com­plete, Givens said. “If I had known that they didn’t care about com­plete ap­pli­ca­tions, all of my clients would have filed an in­com­plete ap­pli­ca­tion,” she said.

Ap­pli­cants were able to sub­mit an in­com­plete ap­pli­ca­tion prior to June 15 and file the at­tes­ta­tion later, said David Harns, a spokesman for LARA.

The al­lowance is listed in a May 3 bul­letin from the agency that says those ap­ply­ing for state op­er­at­ing li­censes should turn in ap­pli­ca­tions that are “as com­plete as pos­si­ble.”

Ad­di­tion­ally, “any­body that asked about” the ad­mis­si­bil­ity of an in­com­plete ap­pli­ca­tion was told that the at­tes­ta­tion form was not im­me­di­ately re­quired with the ap­pli­ca­tion, Harns said.

“Many ap­pli­cants across the state had, in fact, done that by the June 15 dead­line and there­fore are el­i­gi­ble to re­main open af­ter the Septem­ber 15 dead­line passes,” Harns said in an email prior to the judge’s rul­ing.

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