Last week, an administrative law judge issued a ruling stating that medical cannabis operators and patients who use medical cannabis in the state of Florida could resume selling and buying cannabis products online.
Up until February of this year, most medical cannabis operators in the state relied on a popular e-commerce marijuana company I Heart Jane and Leafly to offer online shopping services to patients who use medical cannabis in Florida. However, state health officials prohibited these operators from using third-party sites such as Leafly to process medical cannabis patient orders, arguing that they were in violation of state laws which prohibited operators from contracting for services directly associated with the growing, processing and dispensing of marijuana. The Department of Health issued a memo that same month that stipulated that the department would impose a $5,000 fine on any continuing to use these services.
The memo stated that these services were banned under a 2017 legislation that established a structure for the Florida marijuana industry. The law stipulates that medical cannabis operators should control all aspects of the business including the growing, processing and dispensation of its products, instead of allowing other companies to handle individual components of the business.
The then-chief of staff at the Department of Health, Courtney Coppola, noted that contracting with third-party websites for services directly associated with cannabis dispensation was a violation of this provision. However, Leafly Holdings refuted this claim, noting that it wasn’t engaging in activities associated with the dispensation of marijuana products because it didn’t distribute these products to patients or accept payment for the product.
The Seattle-based company filed a petition requesting the administrative law judge to decide whether the Department of Health in the state of Florida used an invalid law to conclude that the company’s online services violated the law. Judge Suzanne Van Wyk, who presided over the case, gave the ruling on Monday and ordered that the state agency discontinue reliance on its policy with immediate effect.
Leafly and other sites enable patients to see product availability, compare prices and shop online from dispensaries. Patients who order their products online are notified when their orders are ready. However, patients have to pick up the products and pay for them in person at their preferred dispensary location. Licensed medical marijuana treatment centers pay these e-commerce companies for ordering, advertising and marketing services on a subscription basis.
Such lawsuits and rulings help to clarify the boundaries of what is legal and what isn’t for all sector players, including Red White & Bloom Brands Inc. (CSE: RWB) (OTCQX: RWBYF), and consumers are the ultimate winners when everyone is playing by the same rules.
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