Connect with us

Cannabis News

Illinois Court Hears Final Lawsuit Challenging Marijuana Social Equity Business Licensing Lottery

Published

5 hours ago

on

“We are not asking for anything special, no special privileges, but what was promised from the beginning.”

By Hannah Meisel, Capitol News Illinois

Nearly seven years after Illinois lawmakers approved the legalization of recreational cannabis, applicants who lost out on prized business licenses are still fighting the state in court, arguing that the law’s expansion undermined its supposed equity goals.

At the time of its passage in 2019, supporters of Illinois’ landmark law said it was the most legalized cannabis program in the nation. But one of the pillars of that legislation—relinquishing most cannabis business licenses to “social equity” applicants disproportionately affected by the war on drugs—turned out to be more complicated than the law’s authors imagined, spawning years of litigation in the process.

The last of dozens of lawsuits filed after the first cannabis license lottery of 2020 reached court last week, ending a years-long legal saga testing the state’s legalization policy. But it’s also the plaintiff, Well-Being Holistic Group’s last chance to get a dispensary license after losing all four of its applications in three draws.

“We just want a straight line,” the Rev. Otis Davis said after a hearing in the case. “We’re not asking for anything special, no special privileges, but what they promised from the very beginning … So we were saying, ‘Hey, the system is broken, then they should do it again, and they should give everybody a chance.'”

Davis preaches at Repairers of the Breach Ministries in Chicago’s Back of the Yards neighborhood and ran unsuccessfully for Chicago City Council in 2019. He was a member of the group that applied for dispensary licenses in 2020 as the Well-Being Holistic Group. Chris Harris, an attorney who represented David Davis, along with David’s client, joined his business partner and David’s business partner.

Harris was candid in his assessment of Davis’ value to the team: “Not only was Otis a veteran, but Otis was a practicing minister on the South Side of Chicago coming from an area of ​​disproportionate influence; we had what we thought was the perfect team, and the team was designed to win this type of license.”

In fact, the Well-Being Holistic Group’s applications received a perfect score, but still did not win a license. While most of the lawsuits filed against the state after the lottery process have come from applicants who disputed their lottery entry scores, Well-Being’s case argues a different legal theory, which Henderson Parks attorney Chris Carmichael says is the “hardest path” of all lawsuits.

The plaintiff claims that the lottery was rigged

Well-Being argues that the Illinois Department of Financial and Professional Regulation, which administered the lotteries, improperly accepted approximately 450 ineligible entries in a lottery of 901 applicants for dispensary licenses in the Chicago area. This, Well-Being says, almost doubled the size of the pool and reduced the chances of others winning.

Well-Being complains that the entries should have been marked as ineligible because corporate dispensaries that already had a foothold in the Illinois cannabis market had their fingerprints on social equity dispensary license applications.

In one case, Carmichael said a company paid roughly $500,000 in application fees — something that should have been caught by IDFPR and the consultants hired to vet the applicants and run the lotteries because the “ship” line on those cashier’s checks had the company’s name on them.

The IDFPR says it did due diligence by verifying the people named as officers on license applications, which it says would have caught any attempts by the agency to skirt application limits or hide the true ownership of the entity behind an application.

But Well-Being argues that examining only individuals missed the forest for the trees, and the IDFPR ignored dozens of applications with the same corporate sponsor.

Alex Moe, an attorney with the Illinois Attorney General’s office, told Cook County Judge Patrick Stanton that Welfare lacked participation in the application process “as expected by the counselors.” There were also no rules against such consultants paying application fees, he said, unless the consultants had an undisclosed financial interest in the entity applying for the licenses.

Furthermore, Moe said Well-Being’s theory of mathematical unfairness in lotteries is fundamentally wrong.

“Even if Welfare is right and half the applicants shouldn’t be on it, it doesn’t change the outcome,” he said.

Following the “paper trail” created by the lottery, Moe said the IDFPR has recalculated what would happen if the applications reported by Welfare were to be ineligible if they were not in the pool. Welfare would rank 126 out of 450, he said.

“That’s something we know with mathematical certainty, that Welfare would not receive a winning drawing,” Moe said.

Corrective lottery?

But Carmichael noted that with the state’s unused social equity cannabis dispensary licenses, “the only meaningful thing that can be done is to do a corrective lottery.”

The state was already conducting corrective lotteries after initial lawsuits delayed the licensing process for a year. The first social equity licensee-owned dispensaries did not open until November 2022—almost three years after the application process opened. As of January, only 64 percent of licensed social equity dispensaries were operating, according to an analysis by The Chicago Reporter.

Stanton, who said several times during the hearing that the IDFPR had broad latitude to interpret state statute, said he understood Welfare’s claims but seemed skeptical of arguments that a court should step in and tell a state agency how to do its job.

“It seems to me that … there was some testing done before the lottery. Maybe not the level of testing that you think,” he told Carmichael. “You’re saying they didn’t do enough. And I feel like, ‘OK, that’s the department’s decision.'”

The judge said that further evidence that the IDFPR “failed to comply with the statute” would be required to warrant judicial review.

“They did something,” Stanton said of the IDFPR. “Maybe not enough. Applying the standards they did, I feel like they caught what they were supposed to catch.”

The judge will decide in a hearing on May 21.

This the article appeared for the first time Capitol News Illinois and is republished here under a Creative Commons Attribution-NoDerivs 4.0 International License.

Capitol News is an Illinois nonprofit news service that distributes coverage of state government to hundreds of news outlets across the state. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.

Photo elements courtesy of the user rawpixel and Philip Steffan.

Marijuana Moment is made possible with the help of readers. If you rely on our pro-cannabis journalism to stay informed, consider a monthly Patreon pledge.

Become a patron on Patreon!

Related Topics:
Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Cannabis News

Governor vetoes medical cannabis bill

Published

5 hours ago

on

April 13, 2026

By











The veto pen is one of the most powerful tools in the Mississippi Legislature, and Governor Tate Reeves has used it throughout his tenure. This year, his vetoes have mostly targeted public health bills so far, with more to come.

There are three ways Reeves could handle the bills that passed both chambers. He can sign bills he supports and allow them to become law without his signature. He can also block legislation he disagrees with by vetoing a bill or part of it and deferring it to a future legislative session.

As of Wednesday, April 8, he has vetoed four bills, half as many as in the previous two sessions, but Reeves will continue to review the legislation and reject more proposals in the coming days.

Reeves vetoed two medical marijuana bills that passed the Legislature this session, dealing a fatal blow to bills that have already faced friendly chambers. One of the bills, the “Right to Try Medical Cannabis,” contained only one specific provision that Reeves disputed. The original intent of the bill, which Reeves praised, was to expand the opportunity to try medical marijuana to those with debilitating conditions that fall outside the scope of current law.

Read more at Clarion Ledger










Continue Reading

Cannabis News

Lighting science and advanced cultivation to take center stage at Dutch cannabis research tour

Published

1 day ago

on

April 11, 2026

By











The joint MCPIR and Cultivation for Compounds research tour is returning to its regular position on the calendar. On June 8, before GreenTech Amsterdam opens at RAI, two cannabis research consortia from the Netherlands will host a one-day medicinal cannabis event at their research sites.

The morning program runs at MCPIR in Bleiswijk, and in the afternoon it moves to CfC’s Honselersdijk facility. Lunch is provided, and RAI Amsterdam bus transportation is available for participants traveling from the city.

Sonny Moerenhout, founder of Cultivators consultancy, has been organizing the event and will be one of the guest speakers. “MCPIR and CfC do the same kind of work, and to outsiders they might look like competitors,” he says. “But this event is about showing what Dutch horticulture is doing for cannabis. It’s better to do it together than separately.” Cultivators have also recently launched the Leafy Hydroponics Consortium, where infrastructure is being upgraded. LED lights, screens and high-pressure fog are being integrated into the setup. Sonny noted that the consortium had conducted tests with the existing configuration before switching to the new one, and that the improvement of the climate system was continuing as part of a multi-year program.

© Andrea Di Pastena | MMJDaily.com

With years of cannabis experience and knowledge, and now the consortium’s research expertise, Sonny says he brings the latest in advanced cultivation techniques. “Cannabis cultivation is moving incredibly fast, with price pressure on growers keeping pace with it. It’s critical to show growers how to meet the challenges with knowledge and information from the world’s horticultural hub.” Besides Sonny, at the MCPIR event, Mexx Holweg, PhD from Wageningen University, will also be coming up to talk about lighting. Sonny says the addition is aimed at bringing more breeders and licensed producers into the conversation. “With Mexx, we can bring even more breeders and LPs together for interactions with a focus on high-tech growth.”

The audience at the June 8 event typically includes medicinal cannabis producers, technology providers and scientific collaborators from across Europe and beyond. Registration is done directly through MCPIR and CfC; the organizers can be contacted at this address (email protected)

GreenTech Amsterdam will take place from June 9th to 11th at the RAI.

For more information:
Cultivators
(email protected)
crops.nl

Delphi










Continue Reading

Cannabis News

Rhode Island Marijuana Business License Lottery Blocked By Federal Judge Amid Challenge To Residency Rules

Published

1 day ago

on

April 11, 2026

By

“Knowing that the Act faced legal challenges … the CCC went ahead with its plan to implement the Act and its licensing scheme. The resulting fallout will therefore be self-executing.”

By Christopher Shea, Rhode Island Currant

Almost 100 applicants competing 20 new cannabis retail licenses were to be issued by lottery May has been in limbo since a federal judge’s order this week halted the plan.

U.S. District Court Judge Melissa DuBose on Wednesday issued a preliminary injunction against the Rhode Island Cannabis Control Board. The commission is a defendant in three federal lawsuits filed by out-of-state employers over the state’s residency requirement for retail licenses.

DuBose’s order blocks regulators from holding a license lottery or even continuing to review and review retail license applications submitted to the commission until Dec. 29, 2025.

“It’s very frustrating right now,” Jason Calderon, a grower who applied for a retail license in North Kingstown, said in an interview. “This certainly could have been avoided. All we’ve done now is give existing monopolies more time to become monopolies.”

Commission spokeswoman Charon Rose said Friday that regulators were aware of the ruling and were reviewing the implications for the adult retail use licensing program.

“At this time, the commission is not in a position to provide a definitive timeline,” he said in an email to the Rhode Island Current. “Additional guidance will be provided as it becomes available.”

Legal challenges began in May 2024, California cannabis entrepreneur Justyna Jensen sue The Cannabis Control Commission in U.S. District Court in Providence argued that Rhode Island’s residency requirement violated the state’s commercial protections under the state’s Cannabis Act of 2022.

Jensen filed similar lawsuits in other states, including California and New York.

Jensen stated in his initial lawsuit that he intended to become a majority owner of a social equity business, a specialty license reserved for those affected by the war on drugs.

John Kenney, a Florida resident, filed a second federal lawsuit against the Cannabis Control Commission in May 2024 also challenging the residency requirement. Justin Palmore of California filed a third lawsuit on similar grounds on November 24, 2025.

None of the defendants were among the 97 companies vying for a Rhode Island license following the state’s call for applications late last year.

Passed by state lawmakers in 2022, the Rhode Island Cannabis Act called for 24 new retail stores across the state, with six licenses reserved for social equity applicants and another six for employee-owned cooperative stores.

Not all license types received applications in each of the six geographic areas, which allowed regulators to limit the maximum number of licenses to 20 statewide.

Out-of-state investors and ownership are permitted under the law, but a majority—51 percent—of a cannabis company must be owned by a Rhode Island resident.

DuBose dismissed Jensen and Kenney’s suits in February 2025, finding the complaints premature because state regulators had not finalized the rules governing Rhode Island’s retail licenses. The regulations were issued in May last year.

But the cases were revived last November by the 1st U.S. Circuit Court of Appeals in Boston, which ordered DuBose to issue rulings on the merits at least 45 days before the date the Cannabis Control Commission plans to issue retail licenses.

The deadline set by the Commission for the licenses planned in October would be granted in the second quarter of 2026, in May.

Did the state waste time?

The state argued in its legal filings that the residency requirement gives regulators power, jurisdiction and oversight over all retail licensees.

But DuBose eventually found that Rhode Island’s residency requirement was not well suited to advance the state’s interests. It also found that the plaintiffs would suffer irreparable harm because the commission agreed it would not authorize the 24 additional licenses allowed under state law.

The state also tried to get the plaintiffs’ licenses to be considered at the 11th hour. DuBose said the state had plenty of time to make changes to its rules.

“Knowing that the Act faced legal challenges in this Court, the CCC proceeded with its plan to implement the Act and its licensing scheme,” DuBose. he wrote. “The resulting fall will be purely self-inflicted.”

It’s the same line that has attorney Allan Fung, a former Republican Cranston mayor and congressional and gubernatorial candidate representing several retail applicants, questioning why the state didn’t act sooner to avoid the license freeze.

“It’s disappointing that the state didn’t fix the statute and fix these issues sooner, or find a compromise with these three plaintiffs, before people put their life savings at risk,” Fung said in a text message to the Rhode Island Current. “The industry cannot wait any longer.”

Licensing has certainly been slow for cannabis retailers.

It was more than a year after the state legalized recreational cannabis before a three-member commission charged with regulating the industry was unveiled in June 2023. The commission had to hire staff to write proposals and review rules adopted in other states. Rhode Island’s rules governing retail cannabis were finally approved in May 2025. Chairman Kim Ahern stepped down last October to become attorney general, and Gov. Dan McKee (D) has yet to name a successor.

In recent months, the remaining two commissioners considered slowing down the process further Staggering the draw of 20 licenses, instead of giving them all at once. No final decision was made at the last meeting held on March 13.

“It’s always been something the whole time,” Calderon said. “Now it’s this new hurdle.”

That hurdle means many applicants have been paying rent in their storefronts for months waiting to see if they’ll be selected for the license lottery.

“My very frustrated clients have invested tens to hundreds of thousands of dollars to follow a complicated set of rules at the state and local level only to be swept under the rug at the eleventh hour,” Fung said.

Calderon is a little better off financially, as he said the deal in place for the proposed store in North Kingstown doesn’t require rent to be paid until June.

“Obviously that’s going to come and go without a store,” he said. “I’ll probably lose the location because I won’t be able to cover and hold while the state figures out what the next plan is going to be.”

The regulations require that each application secure a location, including zoning approval from the city or town where the store is to be located. Andre Dev, founder of the Community Cannabis Network of Rhode Island, rules that acts as an incubator for many future working cooperatives.

“A lot of other states only require a fee and you don’t have to have your business ready,” he said in an interview. “Most of these applicants could not open the doors because there was no ready test.”

Dev applauded the fact that applicants were able to get those approvals on time after a three-month application window, which left the court dismayed that they never even filed in Rhode Island.

“Somehow their rights are more important than those of us who have put in the time and effort to do all this,” Dev said. “It’s up to the board to sort this out in a way that causes the least harm to people.”

DuBose suggested in his ruling that the state could refund applicants who decide it’s not worth the wait or transfer current applications to a hypothetical new process.

Both houses of the Rhode Island General Assembly have pending bills to remove the residency requirement. Legislation Sponsored by Representative Scott Slater, a Providence Democrat, the House Committee on Corporations heard it on March 12, where it was held for further scrutiny, standard practice for the bill’s first review.

“Obviously we’re going to have to go through something to fix that,” Slater said in an interview. “We need to make sure this doesn’t happen again. We definitely need to open more stores.”

Dev asked the commission to issue emergency rules within 30 days, removing the mandated language and establishing temporary application procedures consistent with the court’s ruling, noting that the state’s cannabis law declares all provisions severable.

“They have the power to deal with it,” he said.

The Cannabis Control Board is scheduled to meet on Friday, April 17 at 2:00 p.m.

This story was first published by the Rhode Island Currant.

Marijuana Moment is made possible with the help of readers. If you rely on our pro-cannabis journalism to stay informed, consider a monthly Patreon pledge.

Continue Reading
Advertisement

Trending

Copyright © 2021 The Art of MaryJane Media