Although the state's medical marijuana legalization law calls for regulators to "actively seek to achieve" racial and ethnic diversity in awarding growing licenses, the commission did not consider the race of applicants. Pictured: A cannabis plant at Northern Lights grow facility in Denver, Colorado on March 27, 2014. (Seth McConnell, The Denver Post)

This cannabis firm is the third to sue Maryland medical marijuana regulators

Alternative Medicine Maryland says it is 80 percent owned by African Americans

Another company that was denied a license to grow Maryland medical marijuana has filed a lawsuit against state cannabis regulators, this time alleging that they didn’t follow a law calling for racial diversity in the potentially lucrative industry.

The suit filed Monday by Alternative Medicine Maryland asks a Baltimore City Circuit Court judge to halt the burgeoning medical marijuana program until the Maryland Medical Cannabis Commission takes action to ensure racial and ethnic diversity among licensed growers.

Although the state’s medical marijuana legalization law calls for regulators to “actively seek to achieve” racial and ethnic diversity in awarding growing licenses, the commission did not consider the race of applicants.

The agency cited a letter from the attorney general’s office that suggested that taking race into account would be unconstitutional. But the attorney general’s office has since said regulators could have commissioned a racial disparity study in similar industries to justify allowing racial preferences.

None of the 15 companies that in August were given preliminary approval to grow medical marijuana are led by African Americans. The Legislative Black Caucus of Maryland plans to introduce emergency legislation to address the issue, possibly by restarting the application process or authorizing additional licenses to minority-owned companies.

Alternative Medicine Maryland says it is 80 percent owned by African Americans: New York health-care executive and physician Greg Daniel and Maryland public housing developers Dan and Dana Henson.

The company is the third prospective marijuana grower to pursue legal action against the cannabis commission, following two companies that say regulators illegally rejected them in favor of lower-scoring companies in an attempt to spread cultivation sites around the state. The companies say cannabis cultivation licenses are worth tens of millions of dollars.

The suit by Alternative Medicine Maryland also alleges that state regulators unfairly discriminated against out-of-state companies and didn’t properly examine whether prospective growers had enough capital to successfully launch businesses.

A spokeswoman for the cannabis commission declined to comment on pending litigation.

Officials with the commission previously said that they are committed to finding other ways to make the industry diverse, but that they do not want further delays to a program that has struggled to make medical cannabis available to patients more than three years after legalization.

Author Information:
Fenit Nirappil covers politics and government in Maryland, Virginia and D.C. He previously covered the California statehouse and suburban government outside Portland, Ore. Follow him on Twitter @FenitN