Three nurseries rejected by health officials for medical-marijuana licenses are challenging the licenses granted to Florida’s first “dispensing organizations,” with possibly more appeals on the horizon before a deadline today.
In a challenge filed Friday, Gainesville-based San Felasco Nurseries argued that the grower was erroneously disqualified. The nursery also alleges that the winner of the license for the state’s Northeast region, Chestnut Hill Tree Farm, is ineligible to be one of the five dispensing organizations, which will grow, process and distribute non-euphoric marijuana legalized last year.
Two nurseries in the Southwest region of the state — Perkins and TropiFlora — also filed challenges Friday.
Labelle-based Perkins, which received the lowest ranking of five scored applicants in the Southwest region, is questioning its ranking from a three-member panel that had the task of picking one licensee in each of five regions of the state.
Lawyers for TropiFlora and its parent company, MariJ Agricultural, Inc., are accusing the Department of Health of wrongly rejecting their application.
A third Southwest region loser — Tornello Landscape — put the department on notice last month that it intends to appeal.
Parents of children with severe forms of epilepsy pushed for the law.
Late last month, the state Department of Health’s Office of Compassionate Use picked five nurseries as the first dispensing organizations.
Under the 2014 law, health officials were supposed to have picked five applicants to grow, process and dispense the low-THC products by Jan. 1 of this year. Legal challenges and a judge’s rejection have delayed its implementation.
While expected, the newly filed challenges could inject yet another delay.
San Felasco’s application was rejected because Daniel Banks, the organization’s director of research and development, failed a level 2 background screening, health officials told the nursery in a letter last month.
But, in Friday’s 59-page filing, San Felasco’s lawyers argued that department officials erroneously rejected Banks.
And, through a series of emails after the nursery submitted its initial application in July, health officials led the nursery to believe that the issue surrounding Banks had been resolved, the grower’s lawyer argued.
Even if Banks failed the background screening, it shouldn’t matter because he isn’t a manager or owner of the organization, San Felasco attorney James McKee wrote.
And, the nursery argued, San Felasco’s application shouldn’t have been scored if the nursery wasn’t eligible for a license, according to the rule governing the dispensing organizations.
The nursery, whose investors in the medical marijuana operations include the prominent lobbying firm Ballard Partners, is asking that health officials put all licensing activity on hold until its petition is resolved, or that the license be yanked from winner Chestnut Hill and given to San Felasco.
San Felasco is also questioning whether Northeast region winner Chestnut Hill is eligible for a license.
Lawyers for Perkins in the Southwest region argued that the nursery’s experience warranted a higher score, and questioned the rankings by the three-member panel comprising of Office of Compassionate Use Executive Director Christian Bax, his predecessor Patricia Nelson and accountant Ellyn Hutson.
Perkins is also questioning whether Southwest region winner Alpha Foliage is eligible under the nursery requirements.
TropiFlora LLC and its parent, MariJ Agricultural, were not among more than two dozen applicants scored by the panel. Health officials decided that the applicant did not provide the nursery’s financial documents required under the law.
Lawyers for TropiFlora argued that, because the nursery is “essentially a wholly owned subsidiary of MariJ,” the parent company’s financial statements should have been enough.
But in a Nov. 23 letter about the decision to reject the application, a Department of Health official said TropiFlora refused a request from the agency to “cure the deficiency in your application by submitting certified financial statements of the applicant itself.”