Cannabis Licensing Chaos In Alabama Heats Up As Medical Marijuana Giant Takes Weed Regulators To Court

Chicago-based marijuana company Verano Holdings Corp. VRNO VRNOF sued the Alabama Medical Cannabis Commission (AMCC) on Monday, reported Alabama Reflector.

Why?

Verano first secured Alabama's highly sought-after Integrated Facility License in June as part of the commission's first attempt to award cannabis licenses and then lost its chance to get a share of the state market. In the process of redoing the license allocation in August, cannabis regulator AMCC chose Insa Alabama LLC instead.

The commission's ability to revoke licenses contradicts and surpasses the authority granted to it by the Alabama Legislature, Verano said in the lawsuit.

"Regardless of the commission's intent when it decided to issue the stay and subsequently 're-award' the licenses, its decision to 'void' previously awarded licenses without following the Legislature's—and its own—clearly established rules and regulations exceeds and violates the statutory authority it has been granted, violates its own rule and is clearly erroneous," the lawsuit, filed in Montgomery County Circuit Court, stipulates. "As such, Verano Alabama's awarded license remains valid."

Background

Verano Alabama, LLC, a joint venture established by Verano, was initially awarded one of the five licenses, which allows a business to operate a cultivation and processing facility as well as five retail cannabis dispensaries throughout the state.

Darren Weiss, president of Verano Holdings, is a speaker at the upcoming Benzinga Cannabis Capital Conference in Chicago this Sept 27-28. He'll undoubtedly have more news on the company's challenges in Alabama.

The need for more transparency in the licensing process was among the concerns that prompted the initial revision of issued licenses. In return, numerous companies sued the commission over closed-door meetings.

Montgomery Circuit Judge James Anderson recently initiated a temporary restraining order that halted the ongoing medical cannabis licensing process undertaken by the Alabama Medical Cannabis Commission.

The move is a reaction to another medical cannabis company - Alabama Always LLC, that took legal action against the state regulator for its faulty cannabis licensing process and seeking a temporary restraining order to block the licenses from being issued.

Alabama Always already accused AMCC in July of improperly deleting meeting recordings, which it considers to be key evidence for the case.

What's Next

According to the Alabama Political Reporter, the commission plans to redo its licensing process yet again on Aug. 31.

In a court filing on Monday, AMCC requested "that the Court continue the preliminary injunction hearing until after Aug. 31, 2023, the date of AMCC's next scheduled meeting, so that AMCC may address the criticisms unwarrantedly leveled against it by voiding the licenses awarded Aug. 10 and re-awarding licenses without going into executive session."

The Benzinga Cannabis Capital Conference, the place where deals get done, is returning to Chicago this Sept 27-28 for its 17th edition. Get your tickets today before prices increase and secure a spot at the epicenter of cannabis investment and branding.

Photo: Courtesy of JRByron, WilliamCho by Pixabay