Medical Cannabis Companies Sue Kentucky Over Licensing Process 

Medical cannabis companies based in Jefferson County, Kentucky, have filed
a lawsuit against the commonwealth and former Office of Medical Cannabis
(OMC) Executive Director Sam Flynn, claiming the rollout of the state’s
medical cannabis program is unconstitutional, the Courier-Journal reports.
The lawsuit claims the Kentucky General Assembly illegally delegated
authority to create the medical cannabis licensing districts and license
limits to the Cabinet for Health and Family Services.

Attorney James Gregory Troutman, who is representing a group of investors
that had hoped to secure medical cannabis processing and dispensary
licenses, told the Courier-Journal that the plaintiffs believe the medical
cannabis license allocation process “was a function that … the legislature
only” could address.

“We’re taking issue with the way the legislature failed to be the ones who
decided how the state would be carved up for licensing purposes into
various regions and how those licenses would be allocated within the
regions.” — Troutman to the Courier-Journal

If successful, Troutman says, lawmakers would have to address the issue
during the next legislative session, where they would “have to adopt an
expansion or amendment” to the 2023 medical cannabis law “to specifically
address how the state gets carved up” for industry licensing.

OMC spokesperson Kendra Steele told the Courier-Journal that the general
assembly gave the agency the duty to create a fair licensing structure in
2023, which she described as “completely open, transparent and viewable to
the public.”

“We are confident that any court will uphold the process,” she said.

The lawsuit asks the court to pause all operations for currently licensed
medical cannabis businesses and issue licenses to the plaintiffs, who were
not chosen to receive licenses during the 2024 lotteries.