Judge Overturns Massachusetts Dispensary Denial

Prices dropping? Rent rising? Get practical insights and proven strategies for running a successful cannabis retail operation with the MJBizDaily Retail Strategy Buyers Guide. Download your free copy. 

A Massachusetts judge has sided with a medical cannabis business over the state health department, paving the way for the company to open a trio of dispensaries.

The ruling came after the company, Medical Marijuana of Massachusetts, sued the state, alleging that officials improperly denied the business licenses last June for three dispensaries it planned to open, according to The Boston Globe. 

Former congressman William Delahunt used to head the company, and his involvement sparked allegations that the state engaged in favoritism.

The company initially won three provisional licenses and was told by the state that it scored the highest of 100 applicants. But health department officials – under fire for how they handled the licensing process – came back five months later and yanked the initial approval.

The health department justified its decision in a letter to the company, saying “it planned to divert excessive revenues to a management company, and made incorrect representations on its application that suggested it had support from then-state Senate President Therese Murray,” The Globe reported.

Suffolk Superior Court Judge Mitchell H. Kaplan sided with the company, however, ruling that the department unjustly reversed its decision after negative publicity regarding the licensing process.

Originally, the dispensaries had been set up to deliver 50% of their revenues to a management firm run by Delahunt and his business partners. The arrangement drew criticism after it was made public, and the number was lowered to 25%. Delahunt resigned in September.