Missouri Supreme Court sides with marijuana regulators in battle over cultivation license
On Tuesday, the Missouri Supreme Court delivered a unanimous verdict affirming that Missouri marijuana regulators acted within their jurisdiction by refusing a cultivation license to Mo Cann Do Inc.
The denial overturns a previous decision by the Missouri Court of Appeals Eastern District in February of 2023. Mo Cann Do Inc. applied for a commercial license to cultivate medical marijuana in 2019, but the company was denied due to an incomplete filing. License applicants were required to include a certificate of good standing from the Missouri Secretary of State, which Mo Cann Do did not.
Mo Cann Do contended that the state’s regulations mandated that the Section for Medical Marijuana Regulation, which became the Division of Cannabis Regulation, must detail any missing information in an applicant’s submission through a notification letter, a step the state had skipped before rejecting the company’s license application. As a result, Mo Cann Do challenged the denial. More than 800 appeals followed the initial awarding of medical marijuana facility licenses.
Both the Administrative Hearing Commission and circuit court sided with the state, but when the Missouri Court of Appeals Eastern District sided with Mo Cann Do in February last year, it appeared there may be a change on the horizon. The appellate court required the Missouri Department of Health and Senior Services and the Division of Cannabis Regulation to grant the company a marijuana cultivation facility license. DHSS and the state appealed that judgement, and escalated the matter to the Missouri Supreme Court.
In the Supreme Court’s decisive opinion, authored by Judge W. Brent Powell, it was determined that Mo Cann Do’s failure to submit a certificate of good standing rendered it ineligible for licensure under the established criteria.
“Even if DHSS did not provide specific notice to MCD of the deficiency in its application, the State cannot be thwarted in its effort to enforce public policy and protect the public interest as it pertains to regulating the cultivation and use of marijuana,” Powell wrote. “It is incumbent on DHSS to ensure MCD or other entities entering the marijuana industry follow the laws and regulations related to the industry so the public can remain safe. This includes ensuring entities seeking to cultivate marijuana in this state are authorized to do business in this state and comply with the regulations requiring a certificate of good standing be submitted with an application for licensure.”
“The AHC’s decision finding MCD failed to meet the minimum standard for licensure is supported by competent and substantial evidence. This Court affirms the circuit court’s judgement,” Powell signed.
In overturning the appellate court’s mandate for license issuance to Mo Cann Do, the Supreme Court may have set precedent applicable to more than a handful of other pending cases facing DHSS and DCR currently.
Read the full decision below.
