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Facing Multiple Lawsuits, Alabama Medical Marijuana Regulators Overhaul Business Licensing Process



“The proposed rule would permit a expeditious, yet transparent, process for all applicants to address the issues that have been raised.”

By Alander Rocha, Alabama Reflector

The Alabama Medical Cannabis Commission (AMCC) adopted new application and licensing rules Thursday after months of legal disputes and amid stalled settlement negotiations over the commission’s evaluation process.

The rules adopted by the commission will allow the commission to keep scores it gave to prior applications but give applicants the chance to outline deficiencies. Applicants will have the opportunity to present their proposals to the commission in a public meeting.

“The proposed rule would permit a expeditious, yet transparent, process for all applicants to address the issues that have been raised in regard to their applications, including any suggested deficiencies in scoring process, including the technical issues they may claim had prevented them from providing their full exhibits,” said AMCC attorney Mark Wilkerson during the meeting.

AMCC Chair Rex Vaughn said the presentation would affect the commission’s decisions on licenses.

“There are questions that probably commission members have not yet had adequately answered, such as residency issues, ownership issues, those kinds of things that we’re not really clear on, so we’ll have the chance to address those,” Vaughn said.

Alabama authorized a medical cannabis program in 2021, allowing medical cannabis to be used to treat about 15 diseases and chronic illnesses.

The AMCC awarded licenses to produce and distribute medical cannabis in June, but inconsistencies in the scoring of applications led to multiple lawsuits and a halt to the licensing process. Companies denied licenses have alleged that the commission was conducting much of its business behind closed doors, a violation of the Open Meetings Act.

Aretha Dix, a former Alabama Medical Cannabis Study Commission member who was denied a dispensary license, said after the meeting that allowing applicants to present their business proposal to the commission gives her hope.

“You get to see our faces,” she said. “You get to see the compassion in our face. You get to hear the compassion in our voice, and you get to see where we come from.”

Antoine Mordican, CEO of Native Black Cultivation, a hemp company that wants to move into medical cannabis cultivation, said his application was  flagged because of a “residency deficiency.” Mordican said that his company is 100 percent Alabama-owned and they showed over 30 years of consecutive residency in their application.

“I’m happy that they’re going to be able to offer us the opportunity to come and speak about the rationality of why we did what it is that we did, and also let them know what’s our purpose behind everything,” Mordican said.

Applicants will also be able to address pass/fail issues identified by the AMCC and submit exhibits that were previously limited due to 10 megabyte file size constraint in the application portal. Applicants will be able to contest a pass/fail mark on their applications but will not be able to bring additional information.

Additionally, the procedures limit the information applicants may redact to personally identifiable information, trade secrets or competitively sensitive information, which Wilkerson said was the initial intent. The rules give applicants 10 days to submit a new redacted copy of the application.

Wilkerson said the commission agreed that redactions were inconsistent.

Asked why the commission didn’t address the inconsistent redactions earlier, Vaughn said after the meeting that he didn’t know if he could address that as the commission kept “an arm’s length” in the redaction process.

“The redaction process is pretty sensitive, as far as our staff goes and our commission members are concerned,” Vaughn said.

The commission also adopted changes to the investigative hearing process for denied applicants. Previously, applicants denied a license had to pay the licensing fee upfront. It would cost an integrated facility $50,000 to have an investigative hearing. For a denied dispensary like Dix’s, it would cost $40,000.

Applicants won’t have to pay a fee to request an investigative hearing in the new rules.

Dix said that gives her the opportunity to focus on services she provides without having another financial obstacle. In addition to the licensing and application fees she said they should have to pay to be heard in front of the commission, or to provide an explanation.

“To pay to be able to divulge that information was more of a deterrence,” she said. “But you still knew—we knew deep down inside that we still have purpose, and we still believe that our company has an opportunity to help the citizens and, specifically, the patients.”

Will Somerville, an attorney representing Alabama Always, which sued the commission in June and August over alleged procedural inconsistencies and in July over the appointment of former chair Steven Stokes, said that while he had to reserve judgment since he has not read the rules personally, they sound promising.

“I think [Wilkerson is] trying to address—and get the commission to address—the issues that we applicants have had with the process,” Somerville said. “So without having read the rules, I think it’s a step in the right direction.”

This story was first published by Alabama Reflector.

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Photo courtesy of Chris Wallis // Side Pocket Images.

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