In separate suit, Department asks applicants to intervene over application confidentiality

 

The Department of Health and Senior Services is again asking medical marijuana facility applicants to help them in appeals to “maintain the confidentiality of reports.”

DHSS’ Section for Medical Marijuana, the state’s licensing authority over medical marijuana facility licenses, is asking all those who applied for a license – including those who received a license and are being regulated by the suit defendant – to intervene on their behalf to prevent the courts from compelling the Department to disclose applications for review by the Administrative Hearing Commission – the state’s appellant court for license appeals.

The Department’s motion to block the release of all applications to the AHC was struck down in a separate case, which had been moved to Boone County for hearing. DHSS has three suits against them asking it to release license applications for the use in appeals. The appeals question consistency in application scoring as a cornerstone of their appeal and request the AHC review and verify applications for use in their appeal.

At no point has the AHC indicated that they would release the applications beyond the use of the court.

All levels of courts, including the AHC, review confidential documents related to cases daily. Appellants have stated they wish to have the applications as a whole reviewed by the court to verify claims of arbitrary and capricious scoring and also verify the use of applications provided by other licensees for use as evidence.

The Department has longtime stood by the state’s scoring process, which was done by a state-contracted, out-of-state third party. The vast majority of appellants believe the scoring process was flawed and cite it as a reason they should be awarded a license.

The state received 2,163 applications in the first open application period in August 2019. Original estimates for the number of applications were between 600-700.

The contracted scoring company, Wise Health, was the brainchild of former Nevada medical marijuana regulator Chad Westom and Oaksterdam University dean Dale Sky Jones.

Andrea Balkenbush, the program’s director of compliance, emailed applicants on Wednesday with a “Notice of Opportunity to Intervene,” just after the Boone County courts denied the same maneuver, based on the claim the Department cannot release applications per the constitution, in a separate suit.

   

Read about the first confidentiality battle here.

Confidentiality takes center state in appeal struggle

This letter comes over two months ahead of a regulatory one-year operational guideline for licensees. It is presumed a handful of licensees will not meet or come close to meeting this deadline, which is in rules – not the constitution – and new licenses will be awarded to those up next on the ranked scoring list.

There are currently over 700 appeals still active with the AHC. Originally over 840 appeals were filed, but over one hundred have dropped their suits in recent months.

Read Balkenbush’s email below.

Sent: Wed, Oct 21, 2020 at 1:13 PM
Subject: MO Medical Marijuana Program-Notice of Opportunity to Intervene

NOTICE OF OPPORTUNITY TO INTERVENE

The Department of Health and Senior Services (“DHSS”) is notifying you of recent events in a matter pending before that the Administrative Hearing Commission which may affect the confidentiality of your medical marijuana facility application data.

The Missouri Constitution mandates that DHSS “maintain the confidentiality of reports or other information obtained from an [medical marijuana facility] applicant or licensee containing any individualized data, information or records related to the licensee or its operation…” Missouri Constitution, Art. XIV, § 1.1.3(5). In accordance with this constitutional requirement, DHSS has objected to providing information from your cultivation application in matters pending before the Administrative Hearing Commission initiated by other applicants.
However, in King’s Garden Midwest, LLC, AHC No. 20-0524, the Commission ordered DHSS to provide documents over DHSS’ objection. (See Order, dated October 9, 2020, attached as Exhibit A.) Specifically, the Commission ordered DHSS to disclose to Kings Garden Midwest, LLC by October 26, 2020, the numerous answers contained within each cultivation application where a licensee received a higher score than Kings Garden Midwest, LLC. The Commission also issued a Protective Order governing the production of data in the above-captioned matter. (See Protective Order, dated October 9, 2020, attached as Exhibit B.)
Based on a review of the scoring and the Commission’s Order, DHSS believes that the Order requires DHSS to provide individualized data from your application for a license to operate a cultivation facility, by October 26, 2020.
Pursuant to 1 CSR 15-3.390, a person with “an interest in the action which is different from the general public interest and which cannot be represented by the parties” may intervene upon a motion.
Your interest in maintaining the confidentiality of your data and the prevention of the disclosure of that data to a potential competitor in the Missouri medical marijuana cultivation market may provide you with an individualized interest in the above-captioned matter that differs from the general public interest.
If you wish to intervene in this matter to prevent your application data from being disclosed to Kings Garden Midwest, LLC, do so as soon as practicable, as DHSS’ compliance with the order is currently due on October 26, 2020. Questions regarding this correspondence may be addressed to the Department’s Office of the General Counsel, at MM-OGC@health.mo.gov