Missouri regulators can now subpoena records from marijuana facilities

If state regulators decide they need to investigate a licensed marijuana facility, they typically ask for certain records.

But an easy place for businesses to “hide” records is with their security companies or other contractors, said Amy Moore, director of the state’s cannabis regulation under the Missouri Department of Health and Senior Services.

Those “third-party entities” are not companies the state directly regulates.

“You can imagine the security companies would have a lot of details relevant to our regulation,” Moore said during a legislative committee meeting in May. “If we are not able to take records or…use a subpoena power to get those records…licensees would have a very easy place to just say, ‘No, we’re not going to give you those records.’”

A new rule that goes into effect Sunday will give the department the power to issue subpoenas directly to licensed marijuana businesses and third parties during an investigation to obtain records and information.

That means the department can now skip the step of going to a judge to request a subpoena.

The constitutional amendment that legalized medical marijuana in 2018 gave the department this power, Moore said, but the department hadn’t passed a rule to use the authority until now.

“We expect this rule will be rarely needed as DHSS can usually access records directly from a licensee,” said department spokeswoman Lisa Cox.

Most businesses licensed to grow or sell marijuana comply with the department’s requests for records, she said.

“Subpoena power will help in situations where third parties — over which DHSS has no direct authority — refuse to cooperate with licensees of DHSS,” Cox said.

When Missouri voters approved recreational marijuana in November, it meant the department had to issue a new set of rules to implement the constitutional amendment. The subpoena rule is a small piece of the 127 pages of new cannabis guidelines, that include everything from packaging to event organizing.

The department first introduced these rules in January, and they went through a public comment phase before making their way through their final hurdle — the legislative Joint Committee on Administrative Rules.

During a May 8 committee meeting, legislators questioned why cannabis regulators needed subpoena power and expressed concerns.

“Let’s say there’s a frivolous employee that is harassing private citizens with these types of subpoenas,” said Sen. Nick Schroer, a Republican from St. Charles and chairman of the joint committee.

   

He asked if there were “checks and balances” in place to prevent that.

“Because we’re dealing with not the licensees,” he said, “we’re dealing with third parties that could be anyone in this room.”

Moore responded that it would be the department issuing the subpoena, not
“employees going rogue.”

“It would be the same if a court issued the subpoena,” she said. “They would still have to also hire an attorney to quash if they wanted to, to dispute in some way.”

Some other state agencies and oversight committees have the power to issue subpoenas when investigating complaints, but a few legislators pointed out that they were given that authority through a state law.

Much of the discussion at the May meeting focused on what part of the constitution gives the department subpoena power.

Moore pointed to a line in the constitution under medical marijuana that allows the department to issue rules regarding, “requirements for inspections, investigations, searches, seizures, and such additional enforcement activities as may become necessary.”

State Rep. Peter Merideth, D-St. Louis, said that line doesn’t give the department “explicit authority” for subpoenas specifically, and Moore agreed.

“We think this is actually kind of a middle ground in enforcement actions,” Moore said. “Because the next step up would be suspending or revoking a license, so we’d rather not jump to that.”

The more intermediate step, she said, would be to gain access to the records and review them.

“And hopefully [we] just solve one problem,” Moore said, “and not try to solve a problem by taking away the entire license.”

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