A state appeals court Monday tossed out a Tampa-based orchid grower’s attempt to enter the state’s medical-marijuana market, finding the nursery lacked standing to challenge eight licenses granted by Florida health officials last year.
Louis Del Favero Orchids Inc. challenged a settlement agreement between the Department of Health and firms known in the industry as “one-pointers.”
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But a three-judge panel of the 1st District Court of Appeal ruled Monday that Del Favero “was not a party to the joint settlement agreement and had not been denied a license based on any application filed.”
The agreement resolved administrative complaints filed by the eight applicants and whittled the number of licenses expected to be available under a 2017 law aimed at implementing a constitutional amendment that broadly legalized medical marijuana in Florida.
“Since Del Favero was not a party to the administrative actions … it does not have standing to bring these appeals,” appeals-court judges Scott Makar, Ross Bilbrey and Harvey Jay wrote in the eight-page order.
The orchid grower had asked the appeals court to nix the eight licenses, arguing, among other things, that the settlement was unfair and contrary to public policy because it “contravenes the legislative intent” of the 2017 law.
Those applicants lost out in a first round of licensing in 2015 after lawmakers legalized types of non-euphoric cannabis and did not meet requirements for licenses in the 2017 law.
The health department is “trying to give away licenses it doesn’t have the authority to give away,” Del Favero lawyer Seann Frazier told the appeals court during arguments in the case last month.
Under the 2017 law, health officials have to give special preference for up to two licenses to applicants that “own one or more facilities that are, or were, used for the canning, concentrating, or otherwise processing of citrus fruit or citrus molasses and will use or convert the facility or facilities for the processing of marijuana.” Following passage of the law, Del Favero spent $770,000 to purchase property in Pinellas County that met the requirements for the citrus preference.
Del Favero had sought to intervene in some of the administrative complaints involving the other firms, but the orchid grower “could not have shown that its substantial interests would be sufficiently affected by the outcome of the administrative appeals” because Del Favero could not demonstrate “real and immediate” threat of injury at the time the petitions were filed, the court found.
Del Favero could not show “injury-in-fact” because, before and after the settlement agreement granted the eight new licenses, three potential licenses are still available, including the citrus-preference license Del Favero said it intended to pursue.
“The preference to be given to former citrus processors … was not eliminated by DOH’s (the Department of Health’s) final orders,” Monday’s ruling said. “It was undisputed that Del Favero never applied for a license under (the statute) and consequently, no such application by Del Favero had ever been denied.”
Del Favero has waged a years-long legal battle in pursuit of a license, with a pile of cases filed in state and federal courts as the nursery’s owners have grown increasingly frustrated over health officials not allowing new applicants to gain access to the market.
Del Favero tried to register as a medical marijuana operator following an October 2018 court ruling, in an unrelated case, that found the 2017 law was “inconsistent” with the constitutional amendment. The state is appealing that ruling.
But health officials ignored Del Favero’s attempts to get a license, while continuing to pare the number of available licenses and thereby giving the new operators a competitive advantage, the orchid grower’s lawyers argued in court documents.
The 2017 state law required health officials to issue 10 new licenses to applicants that met certain requirements. The law also authorized additional licenses, as the number of Florida patients increased.
Overall, the state has issued licenses to 22 operators, including the eight new operators who were granted licenses last year. All of the currently licensed firms originally applied under the 2015 law.
Florida voters in 2016 approved the constitutional amendment to broadly legalize medical marijuana.