Arkansas Medical Marijuana Commission (MMC) Director Doralee Chandler has revoked the cultivation license of Fort Smith-based River Valley Relief (RVR). Her action was procedural and followed a Nov. 3 court ruling to revoke the license. RVR has appealed the court ruling.
The formal order will likely be issued no later than the end of the week, according to Scott Hardin, spokesman for the Arkansas Department of Finance and Administration (DFA), the MMC oversight agency.
Pulaski County Circuit Court Judge Herb Wright ruled on Nov. 3 for a claim by 2600 Holdings that the MMC erred in granting RVR the license in July 2020. 2600 Holdings filed a lawsuit in January 2021, asking the court to disqualify RVR and grant the license to 2600 or provide other relief through the Arkansas Administrative Procedures Act.
2600 attorneys allege that MMC illegally granted RVR owner Storm Nolan a license during a second round of awarding cultivation licenses. The action was illegal because the incorporation in Nolan’s first application was no longer valid, and the proposed center was too close to the Sebastian County Juvenile Detention Center, according to the complaint filed by 2600. The law regulating Arkansas’ medical marijuana requires centers to be at least 3,000 feet away from a school, church or daycare.
The DFA rebutted 2600’s complaint with a 36-page filing. Nolan and his attorneys were blocked by Pulaski County Circuit Court Judge Herb Wright from participating in the court case.
In his ruling, Judge Wright said 2600 has proven it should be given relief, and the MMC acted outside its authority – ultra vires – in granting the license to RVR,
“Plaintiff has, therefore, met its burden in showing that the undisputed facts of the case, viewed in a light most favorable to Defendants, prove that the plaintiff is entitled to relief. Defendants have acted unreasonably, unlawfully, and capriciously by awarding Nolan a license,” Wright noted, adding later in the Nov. 3 ruling: “An effort was clearly made by the MMC to give Nolan thread to stitch up the holes in the RVRC application. Whether that was fair or unfair to any of the applicants, it was at minimum an unconstitutional and ultra vires act.”
At Monday’s (Nov. 28) hearing in which Chandler issued the revocation, Nolan and his attorney Matthew Horan rebutted what they claim are three key erroneous findings in Wright’s order. One was that the original RVR application was within 3,000 feet of a school, which would violate MMC rules for a cultivation center. The original location was within 2,400 feet of the Sebastian County Juvenile Detention Center.
“There is no evidence anywhere that the detention center is operated by a public school,” Horan noted, adding that the Arkansas Department of Education issued a letter saying the juvenile facility was not a school.
Chandler pushed back a few times during Monday’s hearing, reminding Horan and Nolan that the hearing was solely about their license and not a venue to rehear the court case.
Hardin said Nolan has appealed Chandler’s administrative decision, which halts the license revocation and sends the matter to a hearing before the full board of the Arkansas Alcoholic Beverage Control. The next hearing for that board is Dec. 21.
Nolan and his attorneys have appealed the Pulaski County Circuit Court ruling to the Arkansas Supreme Court.
“River Valley Relief Cultivation has appealed the Pulaski Circuit Court decision to the Arkansas Supreme Court. RVRC has asked that proceedings be stayed until the appeal is heard. We await the decision of the Supreme Court,” Nolan said in a statement to Talk Business & Politics.
RVR has about 75 employees, and company owners have invested “more than $8 million” into the licensing and operation of the cultivation center.