Arkansas Judge Halts Last Two Dispensary Licenses Over Racial Bias Lawsuit

An Arkansas judge on Tuesday issued a temporary restraining order preventing the state Medical Marijuana Commission from issuing the last two dispensary licenses until a lawsuit alleging racial bias in the application process can be fully heard, the Arkansas Times reports. The lawsuit was filed by Absolute Essence, which claims that the application process was arbitrary, without any rational basis, and that its procedures were unlawful and inconsistent.

Additionally, the lawsuit alleges racial bias in the commission’s processes, alleging it did not “evenhandedly and uniformly apply its own rules as between black-owned and non-black-owned.” The lawsuit contends that the dispensary application completed by Absolute Essence, a 100% Black-owned company, was not scored properly and should have received a higher score.

The lawsuit argues that “demonstrably less qualified non-black owned businesses – including many that were patently unqualified to even apply for licenses and who should have been disqualified at the outset – have been awarded licenses,” according to court documents outlined by the Arkansas Democrat Gazette.

Applicants for licenses were scored by PCG – a consulting company hired by the commission.

The panel ultimately selected two companies that were next in line in their respective geographic zones based on their scores from PCG to receive each of the two remaining licenses if the change is approved by the Arkansas Legislative Council. As part of the licensing process, the commission divided the state into eight zones, allowing for a maximum of five dispensaries in each zone, and just two zones do not have the maximum of five dispensaries. The lawsuit seeks to prevent the council from approving that change and to stop the commission from issuing any new licenses until it either reevaluates the applications or completes a review using an entirely new process.

The lawsuit names the commission, the Arkansas Department of Finance and Administration, the Arkansas Alcoholic Beverage Control Division, Green Remedies Group, and T&C Management – which is next in line to receive the disputed license.

The temporary restraining order expires on February 15 but could be extended.