Missouri Tosses Residency Requirements for Medical Cannabis Companies

A Missouri judge last week ordered a permanent injunction against the requirement in the state’s medical cannabis law which required cannabis businesses in the state to be at least 51% owned by residents, the Springfield News-Leader reports. Missouri Western District Judge Nanette Laughrey had issued a preliminary injunction against enforcing the residency requirement in June.

The case against the Missouri Department of Health and Senior Services case had been brought by cannabis investment firm Toigo.

Jack Cardetti, a spokesperson for the state’s largest cannabis industry trade group, MoCannTrade, said the organization has not taken a position on the ruling.

Kim Andrews, part-owner of OzaRX Botanicals, a dispensary that’s 100-percent Missourian-owned, told the News-Leader that she was frustrated by the order, describing the now-defunct residency requirement as “one of those few things that [owners] had to keep everybody on even ground.”

“All the big guys have already been kind of standing at the back of the door. Now there’s nothing to keep them from just rolling in and buying everybody up. Their pockets are deep, their marketing budgets are more than I could ever dream of. They can take a hit opening up stores in a way that we can’t. … They can afford to lose a little money in one market where they know they’re going to make it up somewhere else. It really throws competition for a loop.”—Andrews to the News-Leader

It’s unclear whether state officials plan to appeal the ruling. Chris Nuelle, a spokesperson for the state Attorney General’s Office, which is defending the state health department in the lawsuit, declined to comment to the News-Leader, saying the agency doesn’t “typically don’t get into legal strategy.”

In August, a federal judge ruled that Maine officials could not prohibit out-of-state firms from operating medical cannabis dispensaries in the state, effectively tossing that state’s residency requirements.