A Pulaski County circuit judge on Tuesday barred the state Medical Marijuana Commission from issuing additional dispensary licenses throughout Arkansas.
Circuit Judge Wendell Griffen granted a prospective dispensary operator's request for a temporary restraining order in a lawsuit that had accused the commission of improperly overlooking Pine Bluff-based Medicanna's application for a dispensary license when the panel issued an additional license for the southwest Arkansas region earlier this month.
Also on Tuesday, Little Rock's second dispensary announced that it will open today.
Regarding Medicanna's lawsuit, the Medical Marijuana Commission in recent months began exploring the issuance of additional dispensary licenses in areas of the state where medical cannabis retailers have been slow to open.
However, the commission, so far, has issued an additional license in only one of the state's eight regional zones.
Griffen's order temporarily bars any further retail permits from being issued until at least March 3 when there will be a preliminary injunction hearing. The temporary restraining order also prohibits "any further action on such replacement licenses already issued."
Griffen wrote in the order that Medicanna "asserts facts showing a substantial likelihood of success on the merits regarding the violations of the Administrative Procedure act, due process and equal protection and that Medicanna, LLC will suffer irreparable harm absent entry of a temporary restraining order."
The commission decided to issue 32 dispensary licenses spread evenly across eight geographic zones after Arkansans voted to legalize medical cannabis in 2016 through Amendment 98 to the Arkansas Constitution. The amendment allows for up to 40 dispensaries in the Natural State.
The first marijuana selling permits were issued in January 2019, but as of Tuesday, 14 dispensaries remained unopened.
The slo w progress has frustrated the Medical Marijuana Commission, which was authorized under Amendment 98 to handle marijuana licensing.
Last month, the commission voted to issue an additional license in Zone 7, which consists of 13 southeast Arkansas counties. Only one dispensary has opened there. The additional license was given to Nature's Herbs and Wellness of Arkansas in Pine Bluff.
Medicanna's lawsuit takes issue with how the commission selected which company would receive the fifth Zone-7 license.
Medicanna, along with Wild Wings of the Delta in McGehee, scored higher than Nature's Herbs and Wellness during the commission's merit scoring process used to select which companies would receive dispensary permits.
However, Medicanna and Wild Wings of the Delta both requested 50% refunds of their $15,000 application fees, which the commission determined disqualified them from future consideration for a license.
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While the commission discussed disqualifying applicants from license consideration after a refund is requested, Medicanna attorney Chris Burks noted that concept wasn't included in the commission's rules.
All applicants who don't receive a license are entitled to a refund of half the application fee, and they will be formally disqualified two years after the initial licenses were issued, Burks said, citing the commission rules.
"The idea that because someone received a refund and therefore they're no longer an applicant, they're no longer held in reserve, is not supported in the rules or the law," Burks said.
Burks added that Medicanna is confident it will receive a license once the commission "follows its own rules."
Scott Hardin, a spokesman for the Alcoholic Beverage Control Division, said Nature's Herbs and Wellness received its license on Feb. 3, 10 days before Medicanna's lawsuit.
"The company is now the 33rd licensed dispensary in the state," Hardin said. "As the license was issued prior to the lawsuit being filed or today's temporary restraining order, it remains active."
A spokesman for Attorney General Leslie Rutledge, whose office represents the commission, said Rutledge was reviewing Griffen's order and would file a response.
The second Little Rock dispensary to open isn't far from the first.
Herbology dispensary will open at 10 a.m. at 7303 Kanis Road, the former site of Joubert's Tavern. It's just down the street from Little Rock's other dispensary, Harvest House of Cannabis.
Herbology, which bills itself as having "a warm, welcoming vibe that promotes inclusivity," will be open from 10 a.m. to 8 p.m. Monday through Saturday and noon to 4 p.m. on Sundays.
On Tuesday, medical marijuana sales in Arkansas had reached $43.28 million since the first dispensary opened last May, according to the state Department of Finance and Administration.