The Florida Supreme Court has sided with the state in a major case, upholding a 2017 law designed to implement medical Cannabis legalization.
The conservative court’s 42-page ruling came in a drawn-out legal battle launched by Tampa-based Florigrown LLC, reports The Orlando Sentinel. The lawsuit, in part, challenged the state’s system of requiring licensed medical marijuana operators to handle all aspects of the cannabis business. The vertical integration required by the Legislature includes growing, processing, distributing and selling Cannabis.
Florigrown’s challenge argued that the state law ran afoul of the 2016 constitutional amendment approved by voters. Lower courts had sided with Florigrown. In a rare move, the Supreme Court ordered two sets of arguments in the case.
Thursday’s ruling was a 6-1 decision. It found Florigrown “has not demonstrated a substantial likelihood of success on the merits of any of its constitutional claims.”
Vertical Integration in the Sunshine State
The 2017 law requires that marijuana operators handle all aspects of the cannabis business. But Florigrown contended that this vertical integration limits the number of companies that can participate in the industry. A cap which lawmakers imposed on the number of licenses awarded makes the situation worse, Florigrown argued.
Florigrown had argued that vertical integration, by nature, makes it more difficult for smaller companies to enter the business. But the Supreme Court reversed a temporary injunction imposed by Leon Circuit Judge Charles Dodson. The court ruled that the vertical-integration requirement “is within the Legislature’s specific authority.”
The court also rejected arguments against the law’s cap on the number of medical marijuana licenses. Florigrown had previously argued limiting licenses the Florida Department of Health can issue is contrary to the constitutional amendment.
But the Court ruled against previous court rulings that license limits caused scarcity and were unconstitutional. “…[C]ompetent, substantial evidence does not support a finding that the statute has made medical marijuana unavailable,” it said.
‘Weakening the Free Market’
Investors in Florida’s medical Cannabis industry have exercised caution until the case was resolved. Now, Florigrown must decide if it wants to continue the years-long battle, starting over in a lower court.
The voter-approved constitutional amendment legalizing medical Cannabis lists all of the things a medical marijuana treatment center must do. But the use of the word “or” instead of “and” opened the door to argue companies could do some, but not all of the the duties listed.
“We’re disappointed with the ruling,” said Florigrown attorney Jonathan Robbins.
“This ruling is welcomed for this industry because it affirms the regulatory scheme that a lot of participants have already built their business models around,” said John Lockwood. Lockwood represents several medical marijuana license holders. “And for some of the more recent entrants into the market, it allows them to ramp up their spending in Florida with confidence in the regulatory scheme.”
State Agriculture Commissioner and marijuana proponent Nikki Fried, however, blasted the Supreme Court decision. Fried said the medical marijuana market will “remain closed-off, restricting freedom of opportunity, weakening the free market and leading to ever-higher prices for patients.” This is because the ruling means just a handful of companies control the market.
“This ruling by our Republican-dominated Supreme Court further entrenches Florida’s unfair, unconstitutional medical marijuana system put in place by our Republican-dominated Legislature,” Fried said.
“This status quo helps absolutely no one except the 22 medical marijuana companies in Florida at the expense of patients,” Fried added.
Fried is the only Democrat holding a statewide elected office in the state.