Delayed dispensary license notification at center of new suit

The Occidental Group, Inc. is seeking relief from the court for receiving dispensary license notification from the Missouri Department of Health and Senior Services 10 days past the constitutional timeframe.

During the application process, Occidental Group did not receive a rejection notice after submission, thus, they are claiming their application was complete on August 14 – and the group should have received notice within the constitutionally provided 150 day window for license action.

“Petitioner’s allegations are based on the plain language of the Missouri Constitution and relevant regulations,” reads the suit. “On the basis of communications between Petitioner and DHSS, no dispute exists as to the relevant facts.”

An application is considered complete if it included all information required for applications under that rule and 19 CSR 30-95.025(4). Applicants submitting incomplete applications were to be notified and provided seven days to provide missing information. None of Occidental’s medical marijuana facility applications received notification of incompleteness pursuant to 19 CSR 30-95.040 (1)(B)4. Each of Occidental’s medical marijuana dispensary facility applications met minimum standards enumerated in 19 CSR 30-95.025(4) when submitted on on August 14, 2019, during the Application Time Period.

“Under the Missouri Constitution, Occidental was entitled to an approval or rejection of its dispensary applications on or before January 14, 2020.

“Under 19 CSR 30-95.040 (1)(B) Occidental was entitled to an approval or rejection of its dispensary applications on or before January 14, 2020.”

Occidental received notice on January 23, 2020.

Occidental’s complaint alleges DHSS’ violation:

• of the Missouri State Constitution and its own regulations caused the denial of Occidental’s rights by extending the application window, which substantially increased the total number of applications received, without issuing an approval or denial of Occidental’s applications.
• of its own regulations caused the denial of Occidental’s rights by considering applications that were not “applications received by the department that are submitted during the application time periods”, in violation of DHSS’ own rules.
• of Occidental’s rights has caused irreparable harm it its failure to approve or deny Occidental’s medical marijuana facility applications within the 150 day window required by the Missouri State Constitution.

Occidental called for a hearing for injunctive relief and a temporary restraining order on January 22. The motion was heard by Judge Jon Beetem and taken under advisement. The TRO was denied on January 23, with Judge Beetem “finding that the relief sought does not maintain the status quo. Preliminary writ in mandamus to issue.”

   

Notification past the 150 days has resulted in “irreparable harm and damage” to the group, Occidental said in their filing.

“Emergency reliefs as sought will protect Petitioner from the irreplaceable loss of leased properties, local government relationships, and other good will developed by Petitioner in furtherance of its medical marijuana dispensary applications,” reads the suit.

Occidental’s complaint claims that they were in the 10-25% of applicants to not receive a rejection notice. “On information and belief,” 75-90% of facility applicants were not complete, being rejected by the Department for review and submission. The 150 days starts from submission – the start of which had a delay for those in the majority with a rejection.

“Pursuant to 19 CSR 30-95.025(4) Occidental group’s applications should be granted,” the suit reads. “If relief sought is not granted, it will result in irreparable harm to Occidental in that (1) Occidental has been constructively denied a medical marijuana license; (2) the constructive denial of medical marijuana licensure by DHSS will result in the loss of revenue for Occidental while Occidental moves through any appeals processes; (3) Occidental will permanently lose customers and “good will” based upon customers who choose to give their business to other medical marijuana dispensaries, and (4) Occidental will incur attorney’s fees in pursuing litigation and appeals on the matter.

“The relief sought will not substantially affect the rights of others as there is no reason DHSS cannot immediately remedy its constitutional violation by granting Petitioner’s medical marijuana dispensary facility application licenses, as required pursuant to 19 CSR 30-95.025, et seq.”

Occidental applied for two cultivation facilities and five dispensaries. The group won two of its dispensary licenses on Thursday, January 23 – 10 days later than the group expected to receive notice.

The suit will have its next hearing on February 10 before Judge Dan Green.

Read the full suit below.