Cannabis Law Prof Blog

Editor: Franklin G. Snyder
Texas A&M University
School of Law

Wednesday, September 13, 2017

Schain: Keystone State MMJ rollout "got it right"

AaaPennsylvania's medical marijuana program has hit a few bumps on the road so far, and is currently battling lawsuits claiming that regulators improperly granted licenses to the winning applicants.  But Philadelphia lawyer Steven Schain of Hobart Law Group is offering praise and support for regulators who, he says, "got it right."  He offers his take on things in a new piece on the Cannabis Business Executive site, Lessons Learned From the First Phase of Pennsylvania’s Marijuana Program.   A sample:

Ignoring the program’s primary objective of swiftly providing sick people with medicine, the first phase license denials and awards triggered a tidal wave of malevolence to wash across Pennsylvania.

 

Seduced by their own PowerPoint deck’s glitter, both high and mighty and hardscrabble applicants received a rude awakening in the form of both denied ­applications and modest scoring. Stunned by their lack of sway and convinced that shenanigans prevented fair consideration, lawsuits ranging from “striking Pennsylvania marijuana law as unconstitutional” to “disqualifying successful applicants for alleged wrongdoing in other jurisdictions” are being loudly threatened across all 67 counties.

 

Although the program allows each applicant to receive a de-briefing on how respective applications were scored, and for unsuccessful applicants to appeal their scoring, here is what the first phase results revealed:

 

▪ Life ain’t fair.  Mirroring Arizona’s 2016 dispensary permit results (in which 750 applicants sought 31 licenses), each program application had less than 1 in 11 chance of winning.  Further, because the program omits any residency requirement, Pennsylvanians, whom had never grown, processed or sold marijuana, had even less of a chance.

 

▪ Big marijuana carried the day. Approximately 70 percent of the winning applicants were affiliated with growers, processors and dispensaries already operating in multiple legalized marijuana jurisdictions. Beyond being able to demonstrate a history of being a transparent, compliant and profitable marijuana-related business, winning applications were crafted by experts at submitting winning applications, which is distinct from growing, processing and selling marijuana.

 

▪ Consultant means failed grower.  Like a rube swindled by a suddenly exiting town carny, seemingly sophisticated Pennsylvanians got suckered by consultants with shiny trade show booths leveraging claims of “Colorado or California growing experience” and selling fanciful and proprietary lighting, fertilizing and yield optimization techniques.  Also, enjoying handsome windfalls at 400 unsuccessful applicants’ expense were lobbyistS and juiced-in lawyers offering connectivity to politicos with jazzy titles and zero decision-making process impact.

 

▪ Follow the rules closely. Does your diversity definition encompass armed forces veterans or involve third-party certification?  Regardless, because Pennsylvania’s marijuana law defines a diverse group as a certified disadvantaged, minority-owned, women-owned, service-disabled veteran-owned or veteran-owned small business, the program’s unique criteria disqualified many seemingly qualified applicants.

 

▪ Pennsylvania’s Program Is Built to Last.  Perceived inequities aside, the DOH and the program got it right.  Beyond meeting every self-set deadline and blitzing through 500 applications in 90 days, licenses were generally awarded to the best-funded applicants with proven track records of success.  In an exceedingly volatile industry hinging upon timing, adequacy of funding, and fullness of regulatory compliance, in the first phase the DOH has positioned the program for its greatest likelihood of swift success.

Read the whole thing. 

http://lawprofessors.typepad.com/cannabis_law/2017/09/schain-keystone-state-mmj-rollout-got-it-right.html

Business, Medical Marijuana, State Regulation | Permalink

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