The state’s highest court is slated for a second round of hearings on how state lawmakers structured licensing requirements for medical marijuana growers. After voters passed a constitutional amendment in 2016 that effectively legalized the drug for medical use, the Florida Supreme Court will hear oral arguments on Wednesday focused on whether or not Florida Legislature, and the Florida Department of Health’s efforts to implement the amendment qualify as “special laws,” which unconstitutionally limit which firms may operate in the industry.
It is the second high-court hearing on the matter this year. In May, the court heard oral arguments in a case brought by Tampa-based Florigrown, which has, thus far, not been awarded a license by the Florida Department of Health. Florigrown is challenging the constitutionality of the law, passed in 2017, to ostensibly implement the 2016 constitutional amendment.
Relying on that law, the Florida Department of Health (FDOH) crafted rules that automatically granted licenses to some applicants they initially rejected prior to the passage of the Amendment. At the same time, any new applicants, including Florigrown, its lawyers argue, had to meet a new set of arbitrary requirements.
“There is no possibility, much less ‘reasonable possibility,’ that other entities may be licensed without applying and qualifying under the additional requirements in [one section of the new law] from which the existing licensees are exempt,” Florigrown’s lawyers argued in a brief.
Florigrown’s case is bolstered by the fact that FDOH dragged its feet in issuing rules that would clarify market restrictions for potential growers. After a trial court and an appeals court both ruled in Florigrown’s favor, FDOH appealed again to get the case heard by the Florida Supreme Court.
The medical-marijuana industry has been largely on hold in Florida since the 2014 passage of the Compassionate Care Act, which installed a rudimentary framework for the beginnings of the medical-marijuana industry in the state. But the process bogged down over rulemaking (or, more accurately, the lack thereof) by the Florida Department of Health. Their rules, slowly but deliberately constructed so that only one grower per “region” could qualify for a license, faced a series of legal challenges from other industry players who had been frozen out.
Ultimately, an administrative law judge ruled against FDOH’s convoluted regulatory scheme and awarded additional licenses to other industry players. Florigrown, however, was not among them, as it didn’t meet the FDOH’s definition of a “vertically integrated” grower that could cultivate, harvest, process, transport and dispense the drug to qualified patients.
And therein lies the problem: the constitutional amendment passed by voters in 2016 specifically redefined the terminology in such a way that it undercut the state’s regulatory scheme, effectively eliminating the requirement for industry operators to be “vertically integrated.”
Florigrown’s argument is that one clear intent of the constitutional amendment was to eliminate the artificial constraints placed on the industry by lawmakers and state regulators. Such constraints hamper a free market system, stifling competition, restricting access by patients, and driving up prices for treatment. Florigrown believes the amendment supports an alternative “horizontal” system that would allow vendors to specialize in different aspects of the medical marijuana industry.
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