Pubdate: Thu, 25 Aug 2011
Source: Arizona Republic (Phoenix, AZ)
Copyright: 2011 The Arizona Republic
Contact: http://www.azcentral.com/arizonarepublic/opinions/sendaletter.html
Website: http://www.azcentral.com/arizonarepublic/
Details: http://www.mapinc.org/media/24
Author: Mary K. Reinhart
Bookmark: http://mapinc.org/topic/Dispensaries

SUIT TARGETS RULES FOR MEDICAL-MARIJUANA DISPENSARIES

As if medical marijuana wasn't being litigated enough in Arizona, yet 
another lawsuit takes aim at the rules governing dispensaries.

The special action, among six suits involving the state's fledgling 
program, claims the rules give unfair advantage to local businesses 
in violation of federal law and the state and federal constitutions.

Gerald Gaines, CEO of the for-profit Compassion First AZ, had hoped 
to oversee a string of dispensaries operated by "affiliate" managers 
who would apply for dispensary permits. Some of those managers, 
however, fail to meet the criteria because they haven't been Arizona 
residents for three years, haven't filed three years worth of state 
income taxes and, in one case, filed personal bankruptcy more than 25 
years ago.

Among other things, the rules discriminate against non-residents and 
new residents, benefit current property owners and violate federal 
bankruptcy laws by holding past financial problems over someone's 
head indefinitely, according to the suit, filed last month in 
Maricopa County Superior Court.

"They're a mess," Gaines said of the rules. "It's hard to believe 
that someone was making a legitimate effort to write rules that would 
make the system work."

State health officials said they could not comment on pending 
litigation, but the state Attorney General's Office has moved to 
dismiss the case or at least put it on hold pending outcome of a 
federal lawsuit the state filed in May. Otherwise, attorneys said, 
judges may become buried in marijuana lawsuits.

"There is limitless potential for filings in state courts from other 
dispensary applications who have been or will be denied their 
applications," assistant attorney general Lori Davis wrote. "This 
could create a further deluge of complaints and special actions 
inundating the courts with countless cases involving the same subject matter."

The dispensary permit process, set to begin June 1, was put on hold 
when Gov. Jan Brewer filed the first lawsuit, this one in federal 
court, asking the court to decide whether compliance with Arizona's 
voter-approved medical-pot law shields state employees, patients, 
dispensary owners and others from federal prosecution.

The delay has spawned five more lawsuits, including Gaines' filing 
and three others challenging the state's failure to accept dispensary 
applications, as the voter-approved law requires.

The sixth and most recent legal action was filed Aug. 4 by Attorney 
General Tom Horne to quash "compassion clubs," donation-based 
hangouts where members with state-issued medical-marijuana IDs can 
get pot that's been donated by other qualified patients.

Proposition 203, approved by voters in November, allows for legal 
action in Superior Court if the state fails to implement the law. But 
the possession, sale and use of marijuana remain illegal under federal law.

Potential dispensary owners argue that the federal Controlled 
Substances Act allows flexibility for states to adopt their own drug 
laws, and three appellate cases in California back that argument. 
Arizona is among 16 states with medical-marijuana laws.

Gaines' lawsuit is the only one so far to challenge the state's 
medical-marijuana rules.

Many of the same people who pushed the ballot measure worked closely 
with the state Department of Health Services on the rules. Joe Yuhas 
of the Arizona Medical Marijuana Association said his group advocated 
several requirements that Gaines and others take issue with, 
including the residency requirement for primary investors and 
officers. Colorado also has a residency requirement for dispensary 
owners, officers and employees.

Yuhas said it's important for the industry, particularly in the early 
going, to "demonstrate that it has ties to the community - that they 
are not some distant investor."

"I understand how that can conflict with the business interests of 
others. But so be it," he said.

But Gaines said his group participated in the rule-making process, too.
- ---
MAP posted-by: Jay Bergstrom