In a case that could have important implications for the medical-marijuana industry, Florida Supreme Court justices waded into a battle about whether the state has properly carried out a 2016 constitutional amendment that broadly legalized marijuana for patients.
The Florida Department of Health appealed to the Supreme Court after lower courts sided with Florigrown, a Tampa-based company that argues a 2017 state law conflicts with the constitutional amendment. Florigrown has unsuccessfully sought department approval to become a licensed medical-marijuana operator.
The case primarily centers on a requirement that the Legislature put in the 2017 law about marijuana firms allowed to operate in the state. That requirement says the companies must be able to handle all aspects of the business, including growing, processing and distributing products — a concept known as a “vertical integration” system.
But Florigrown contends that was not the intent of the constitutional amendment and that a vertical integration system limits the number of companies that can take part in the industry. The alternative would be a system where firms could perform different aspects of the business, known as a “horizontal” structure.
Joe Jacquot, Gov. Ron DeSantis’ general counsel who represented the Department of Health on Wednesday, said the 2017 law does not directly conflict with a “proper, textual interpretation” of the constitutional amendment.
“Nothing in the amendment prescribes a horizontal market model,” Jacquot told justices. “Nor does the amendment elbow out the Legislature’s vertical integration” of the firms, which are dubbed medical marijuana treatment centers.
But Florigrown attorney Katherine Giddings said the Legislature cannot “under the guise of public policy come in and change the plain text of the Constitution.” She also said the vertical integration system affects patients.
“There’s something wrong with a system that keeps competition out, makes products scarce and prices outrageously high, that is harming Florida’s critically ill and terminally ill patients from getting medical marijuana at reasonable prices,” Giddings said. “And it is totally contrary to fair-market principles.”
A panel of the 1st District Court of Appeal in July upheld part of a temporary injunction issued by a Leon County Circuit Judge Charles Dodson, who found that the 2017 law conflicted with the constitutional amendment. Dodson’s temporary injunction required state health officials to begin registering Florigrown and other medical-marijuana firms to do business, but the judge’s order was put on hold while the state appealed.
The Florigrown case is part of a massive amount of litigation in recent years about how the state has moved forward with the medical-marijuana industry, with much of the litigation centered on companies trying to get into the business.
It is unclear when the Supreme Court might rule in the Florigrown case, with decisions typically taking months. The Florida House has joined the DeSantis administration in defending the law, with House General Counsel Daniel Bell taking part in Wednesday’s arguments.
A key part of the case, including during Wednesday’s arguments, has focused on the difference in the words “or” and “and” in determining whether the vertical-integration model is proper.
The constitutional amendment defined medical-marijuana treatment centers as “an entity that acquires, cultivates, possesses, processes … transfers, transports, sells, distributes, dispenses, or administers marijuana, products containing marijuana, related supplies, or educational materials.”
Meanwhile, under the 2017 law, “a licensed medical marijuana treatment center shall cultivate, process, transport and dispense marijuana for medical use” — wording that establishes the vertically integrated system, as it establishes a need to perform all aspects of the business.