Ruling could revoke marijuana cultivation license for River Valley Relief

A Dec. 30 ruling by Pulaski County Circuit Judge Herbert Wright Jr. again places in jeopardy the future of Fort Smith-based River Valley Relief (RVR), which is one of eight licensed medical marijuana cultivation facilities in Arkansas.

Wright’s recent ruling is part of a more than four-year legal battle over how the cultivation license was awarded to RVR by the Arkansas Medical Marijuana Commission (MMC).

Attorneys for 2600 Holdings – a company seeking a cultivation license – alleged in June 2020 that MMC illegally granted RVR owner Storm Nolan a license during a second round of awarding cultivation licenses. The action, according to 2600, was illegal because the incorporation in Nolan’s first application was no longer valid, and the proposed center was too close to the Sebastian County Juvenile Detention Center, according to the complaint filed by 2600.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.

Judge Wright in November 2022 ruled in favor of 2600 Holdings.

Nolan and his attorneys have repeatedly pushed back against the 2600 allegations and what they say are erroneous findings in the 2022 Wright ruling. 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, which is not a school.

In April 2024, the Arkansas Supreme Court ruled in favor of RVR and reversed and remanded Wright’s ruling. The Supreme Court also vacated a summary judgment against RVR. The majority opinion did not rule definitively on the allegations by 2600 Holdings but held that Nolan was not properly granted the opportunity to defend his license during the lower court process.

In his 28-page Dec. 30 opinion, Wright again came down in favor of 2600 by saying the MMC did not properly award the cultivation license.

“The Court does not have the authority to pick the proper applicants for the MMC. Nor does it have the authority to strip a party of a license and direct that it be granted to another. But the Court does have the duty, when entreated, to point out when the State has exceeded the authority granted to it by the voters of the State of Arkansas in a constitutional amendment. The posture of this case, following two remands from the Arkansas Supreme Court, is that it must do so. The Defendants, in awarding a cultivation permit to an entity that never applied, made a decision that violates the Arkansas Constitution, and it violates the Rules enacted for the operation of the MMC. The Court finds that the MMC has not acted within its own ministerial duty and has exceeded its discretion,” Wright noted.

Nolan told Talk Business & Politics that the fight for the license is not over. As of November 2023, RVR had about 75 employees, and had invested more than $8 million into the licensing and operation of the cultivation center.

“We have received a copy of the Circuit Court’s order. We are disappointed and disagree with the ruling. We will continue to defend the license that was lawfully issued to us by the State of Arkansas,” Nolan said in a statement.

Scott Hardin, spokesman for the Arkansas Department of Finance and Administration, the parent agency of MMC, said it is unclear what happens next.

“The Medical Marijuana Commission will meet January 9. That will be the first opportunity for the Commission to discuss next steps. Commissioners will likely look to legal counsel for guidance. Attorneys from ABC (Alcoholic Beverage Control) and the AG’s (Attorney General) Office will be in place to answer their questions. They have been reviewing the Order. We will know more following the meeting on the 9th,” Hardin explained in a statement.