On Friday, June 15, 2018, the honorable Administrative Law Judge, John Van Laningham, issued a Recommended Order determining that the nursery meets the “within-one-point” condition of eligibility for licensure and as a result, recommending that Nature’s Way Nursery of Miami Inc (Nature’s Way) should be granted a Medical Marijuana Treatment Center License. This symbolizes the nearing of an end to a long fight for Nature’s Way. In a separate lawsuit involving Nature’s Way, the ALJ also ruled that emergency rule, 4ER17-7(1)(b)-(d), constitutes an invalid exercise of delegated legislative authority, and the policies upon which Department of Health (“DOH”) based its scoring of nurseries in the 2015 dispensing-organization application cycle constituted an unadopted rule.
The DOH has been granted authority to adopt rules necessary to implement the cultivation and dispensing of medical marijuana within the states borders. The DOH then went on to promulgate rules and licensed 5 Dispensing Organizations, now called Medical Marijuana Treatment Centers. Lawsuits erupted after the denial of licenses in this first round of licensing, as only one nursery was awarded a license per region, and there were only five regions. This created an issue because far more nurseries applied than there were room for licenses. From there, during a special session held by the legislature in 2017, section 381.986, F.S., was significantly amended establishing a licensing protocol for 10 new Medical Marijuana Treatment Centers (“MMTCs”) by October 3, 2017. We are now in July of 2018 and only 13 nurseries have received Medical Marijuana Treatment Center Licenses. This amendment instructed the DOH to license any applicant that met the following criteria:
- any applicant whose application was reviewed, evaluated, and scored by the department and which was denied a dispensing organization license by the department under former section 381.986, F.S.;
- which had one or more administrative or judicial challenges pending as of January 1, 2017, or had a final ranking within one point of the highest final ranking in its region under former section 381.986, F.S.;
- which meets the requirements of this section; and which provides documentation to the department that it has the existing infrastructure and technical and technological ability to begin cultivating marijuana within 30 days after registration as a medical marijuana treatment center.
After the amendment, several nurseries, including Nature’s Way, informed the DOH that they met the criteria listed above, however, the DOH again denied several of these nurseries requests for licenses to dispense medical marijuana. One, of the many, nurseries that went through this process was Nature’s Way. From there, Nature’s Way appealed that decision to the Division of Administrative Hearings (“DOAH”). In DOAH, Nature’s Way and Keith St. Germaine Nursery Farms (“Keith St. Germaine) cases were consolidated. Keith St. Germaine was granted its license in the end of 2017. However, Keith St. Germaine had to fight long and hard for its license. Read our prior blog that lays out the specifics of the Keith St. Germaine case as well as the beginning of the Nature’s Way case, as the two were consolidated at DOAH.
The Nature’s Way case is a monumental case in the Florida medical marijuana community because it marks the nearing of an end to the lawsuits brought by nurseries challenging the scoring method of the DOH for the first round of licensing. However, there are other lawsuits still ongoing not related specifically to the scoring of nurseries that applied for licenses. From here, there are hopes that the DOH will now finalize its proposed rules for the next round of licensing. It is clear that the eruption of lawsuits has caused a chilling effect on the DOH to promulgate new rules. It will be interesting to watch if the DOH promulgates its proposed rules for the next round of licensing now or waits for other lawsuits to also come to an end.
Despite the ALJ’s favorable Recommended Order, Nature’s Way journey may be far from over. In the Florida administrative law arena, the DOH gets the final say and can accept or reject the ALJ’s recommendation in its final order. Such a rejection would force an appeal by the nursery, which can lead to more time, energy, and resources to get the license to which it is entitled. Still, in other situations, the DOH may settle these cases, with or without issuing a final order. The only way to handle this situation is to have a wait-and-see approach as the final stages unfold. However, these cases serve as an important reminder that nurseries can contest and fight for Medical Marijuana Treatment Center Licenses that rightly belong to them.