Setback Strikes Alabama's Medical Cannabis Industry, Licenses On Hold Yet Again

Alabama’s medical marijuana regulator wrapped up 2023 with yet another setback in its efforts to issue licenses to businesses seeking to legally dispense the plant.

On Thursday, Montgomery Circuit Judge James Anderson issued a temporary restraining order putting a hold on the issuance of licenses in the dispensary category, reported the Alabama Political Reporter.

The move is a result of a recently reenacted legal battle involving a group of medical cannabis operators such as Yellowhammer Medical Dispensaries, LLC, Pure by Sirmon Farms, LLC, and Alabama Always, LLC against the Alabama Medical Cannabis Commission (AMCC).

The AMCC granted 20 licenses for the production and distribution of medical marijuana (MMJ) on Dec. 1, as part of its third attempt to kickstart the new industry.

However, last week, Judge Anderson approved Yellowhammer Medical Dispensaries’ request to halt the license issuance.

Why The Hold?

The judgment cited the commission's failure to follow its own grading, averaging and ranking guidelines.

The AMCC has been accused of procedural violations by Yellowhammer and Pure, both of whom were denied MMJ licenses.

Yellowhammer, which was twice granted a dispensary license by the commission in its first two attempts to hand out permits over the summer, was left without one in the third round of awards on Dec. 1.

The commission revised its process for the third round by opting to exclude the rankings provided by third-party evaluators from the University of South Alabama. In the first two rounds, Yellowhammer had the highest score for dispensary applicants.

The revision was prompted by several lawsuits brought by companies like Medella LLC and Verano Holdings Corp. VRNO VRNOF, among others, filed against the commission in 2023.

The commission is legally limited to granting only four dispensary licenses, and each licensee has the opportunity to operate three separate dispensaries.

In the meantime, AMCC got the green light to issue another medical cannabis license for cultivators, processors, transporters and testing labs, starting Friday, Dec, 29, as Judge Anderson declined other requests for a temporary restraining order (TRO) on the permit allocation process, per the outlet.

The integrated facility licenses that permit vertical integration statewide and which the AMCC granted to five businesses on Dec. 12 – are expected to be issued after Jan. 9.

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