Pennsylvania Lawsuit Threatens State MMJ Program

Pennsylvania lawmakers and advocates are up in arms over a lawsuit that could threaten to wipe out the state’s budding medical marijuana program.

The lawsuit was filed on Sept. 8 by Keystone Releaf, one of the companies who did not get an application during the state’s first wave of accepting permits. According to the lawsuit, the aspiring dispensary owner believes the Department of Health screwed up the whole application process when it came to actually awarding the permits and in the process broke the regulations meant to guide the program. Hence, Keystone Releaf is seeking an injunction by the courts to halt the state’s entire medical cannabis program — despite the shock-wave effect it could have on Pennsylvania patients who’ve already waited this long.

Luckily, the state senator who led the effort to legalize medical marijuana is now coming to bat for patients once again. In a letter to the legal firm representing Keystone Releaf, State Sen. Daylin Leach urged the laywers to have their client take another look at their actions.

“I can’t imagine a company such as Keystone ReLeaf, which took the time and effort to try to enter this space, presumably to help patients, would want to be responsible for harming patients in such a cruel way,” said Leach in the letter.

Leech went on to note his firm commitment to neutrality in the Department of Health’s selection process, only saying he hoped the best applicants got the licenses. He didn’t make light of the idea that Keystone Releaf was wronged in some way during the process, but is convinced there was a better way for them to move forward.

“My commitment to neutrality extends to your lawsuit,” said Leach. “That said, it is my belief that any unjust inconvenience or financial loss your client may have suffered can be remedied by a court in many ways short of shutting down the entire program. Because surely, no deprivation your client has sustained can be worth inflicting additional suffering on patients or literally costing them their lives.”

We reached out to longtime activist, Temple University instructor and Philly.com columnist Chris Goldstein to get his take. Goldstein has had a finger on the pulse of the Mid-Atlantic cannabis policy scene for a decade and is one of the go to folks for Pennsylvania pot policy. (For his efforts, last week he won the Hunter S. Thompson NORML Media Award at the organization’s national conference.)

“What we see are law firms and sour grapes losers who didn’t win in the first permits who try and force the program into suspension,” said Goldstein. “Now this happened in Maryland and in Florida. Both states had problems.”

Goldstein said that before Florida passed its new medical cannabis law last year, they had a very limited law they were trying to implement at the same time that Maryland was going through implementation process as well.

“When it was exposed there was a lot of corruption in the selection of these permit holders and flaws in the selection process they suspended both states’ programs,” Goldstein said. “In Maryland’s case they actually went back and legislatively amended the law. Permit holders had to wait three years from initially getting the permit and are now starting to open.”

Goldstein believes the lawsuit is among the first of many that will seek to force a Maryland-style hand in Pennsylvania, adding the Keystone Releaf lawsuit was the boldest one he’s seen yet.

“The idea that any business in good faith trying to win one of the permits is going to try and shut it down for all the patients just shows where their sentiment was to begin with. They weren’t in it for the patients, they were in it for the business model,” Goldstein said.

When asked if he thought the lawsuit had legs, Goldstein responded that he doesn’t think this single lawsuit is going to have as big an impact on the program. “But I think if we see more —” Goldstein responded ominously, “if we see a flight of lawsuits like this, just like Maryland, it could force the program into suspension. It’s usually not one lawsuit that does it.”

Goldstein believes that, when states try to limit with over-restrictive licensing processes instead of operating with more of a free market system, they become more susceptible to this kind of event. “That’s what makes it vulnerable to lawsuits, the limited program,” Goldstein said. “In a free market, they wouldn’t have the leverage to shut down the whole program.”

Goldstein closed on one of a unique aspects of Pennsylvania’s law, which was that publicly traded companies were able to apply for permits since day one. “It was the first time ever, so Pennsylvania attracted a different type of corporate investor and those kinds of people have lots of lawyers.” The ease of which some of the other failed applicants could get another lawsuit going is worrisome for anyone hoping for this chapter to end.

Becky Dansky covers all things Pennsylvania-cannabis-related for the D.C.-based Marijuana Policy Project. She also doesn’t believe this particular case will do too much.

“I don’t think they’re going to get anywhere with it,” Dansky said. “There are 141 other people sad they didn’t get a license, who filed appeals and they’re not trying to hold up the program for these patients who’ve been waiting so long now.”

Contrary to the lawsuit, Dansky believes the departments have done a really good job on the rollout. “They’ve stuck to the timeline, we believed two years was a realistic timeline. They’re going to come in just under it,” she said.

“It’s been going really well with a couple of bumps here or there and it’s just really frustrating when people are like ‘I deserve to have a license because I say so and I’m going to hold up to 200,000 to 250,000 patients potentially.’ They’re going to have to sit around waiting because somebody thinks they somehow got snubbed and that’s really frustrating to me. If you think that you getting a permit is more important than people getting their medicine, you don’t deserve to be in the medical marijuana business,” said Dansky.

Dansky also noted the letter by Sen. Leach was spot on. “I think he did a really good job of saying he wasn’t dismissing their claim but if they want to go through with it you can do it without doing this to patients,” she said.

In the lawsuit, one of the arguments against the state is that the Department of Health issued permits to a company under investigation in New York. However, the only thing applicants were required to disclose was convictions — not investigations, according to Dansky.

“Of course if the reviewers had knowledge of medical marijuana news they would have recognized that company’s name and if any had seen that name on the application they wouldn’t have awarded it to them. But because the information was redacted, the reviewers couldn’t actually see that. They went by what they saw on paper. Now knowing what they know, should they maybe reconsider? Probably, but you can’t have it both ways,” Dansky said.

TELL US, how should the courts balance pursuing justice and granting access for cannabis patients?