Lawsuits Contest Minnesota Cannabis Agency’s Social Equity Application Denials

Two lawsuits have been filed against Minnesota’s Office of Cannabis Management (OCM) aiming to delay the state’s lottery for social equity licenses, the Star Tribune reports. The lawsuit comes after the agency last week denied some 1,200 social equity applicants – about two-thirds of all applications – for issues ranging from inadequate paperwork to “flooding” the application pool in attempts to improve the odds of receiving pre-approval. 

The lawsuits were filed last week by eight license hopefuls who contend the OCM denials were arbitrary or without explanation. Jen Reise, an attorney who filed a lawsuit on behalf of six applicants, said the OCM’s evaluation process was “unfair” and inconsistently applied. The lawsuit seeks a temporary restraining order delaying Tuesday’s lottery and that her clients be given the opportunity to correct paperwork errors.  

“We’re deeply concerned that OCM has been unwilling to engage with social equity applicants, many of whom were denied for extremely minor paperwork problems or whose denials are not supported by the reasons OCM is giving them.” — Reise to the Star Tribune 

In the other lawsuit, Cristina Aranguiz, one of the denied applicants, said the explanation by OCM for the rejection of her application “made no sense” when considering the state’s requirements. 

In a statement issued following the lawsuit filings, Charlene Briner, interim director of OCM, called Aranguiz “the face of a scheme to use hundreds of straw applicants to gain unfair advantage in the lottery.” 

“This attempt to flood the zone and place their thumb on the scale at the expense of legitimate social equity applicants is disturbing,” Briner said in the statement. “These kinds of spurious tactics have been used in other states and are well-known to anyone paying attention to the evolving cannabis industry nationwide – and precisely what social equity advocates and authors of Minnesota’s cannabis legislation cautioned about and thoughtfully prepared against in state law.”