September 27, 2020

Companies may drop suit over marijuana licensing if Illinois gives applicants more time to fix errors

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CHICAGO — A federal lawsuit filed by two companies over Illinois’ handling of marijuana licenses could be dropped if the state agrees to certain changes to the licensing process, officials familiar with the matter said Sunday.

The state previously announced 21 of 700 “social equity” applicants will proceed to a state lottery for 75 available marijuana licences later this month. 

These “social equity” licenses are meant to benefit individuals from under-developed communities impacted the most by the war on drugs.

“The Illinois legislature with the governor’s support felt it was a good idea to legalize marijuana to eliminate some of the disparities and give people a chance at an economy that will allow them to have a business in Illinois selling cannabis,” Illinois state Representative La Shawn Ford said.

However, Ford and some social equity applicants are alleging those selected for the lottery are “politically-connected insider companies.” A federal lawsuit filed by two companies who were rejected is currently pending.

“These licences are worth millions of dollars and will be life-changing for applicants who earned them,” Ford said. “That excitement has now turned in frustration and bitter disappointment.”

Southshore Restore and Heartland Greens didn’t make the cut and are suing the state’s Department of Financial and Professional Regulation, which oversees dispensaries, and bret bender, deputy director of the cannabis control section.

On Sunday, Ford said attorneys are willing to dismiss the lawsuit if the playing field is “levelled.”

“Among the most important equalizing provisions we want you to know there is a process called a deficiency notice procedure,” Ford said.

Governor Pritzker’s office did not immediately respond to requests for comment Sunday evening.

That deficiency notice would give applicants a 10-day period to fix any problems on their forms, Ford said, says in some cases, whereas he said some applicants were never given that opportunity.

“Many did not learn their applications were deemed insufficient until they received notice on Sept 3rd that they did not win,” Ford said.

Another concern is reports of inconsistencies in the way scores have been calculated. 

“Teams that submitted identical exhibits sometimes received different scores,” Ford said. Ford adds those who feel they weren’t given a fair shake, have no recourse.

“Among 700 social equity applicant teams invested so much time and borrowed money and are in debt right now and they deserve a fair process,” Ford said.