The Los Angeles Department of Cannabis Regulation (DCR) conducted its lottery for cannabis retail applicants Dec. 8, selecting 100 social equity applicants to advance in the cannabis dispensary licensing process.
The move comes after a court ruling last week allowed the licensing process to proceed.
The lottery included a process that allowed individuals to request verification as a Social Equity Individual Applicant (SEIA). More than 1,000 individuals requested SEIA verification and more than 500 SEIAs met the criteria to participate in last week’s lottery.
The list of individuals selected in the lottery can be found here.
The DCR plans to conduct another SEIA verification process and another lottery in early 2023.
Thursday’s lottery, officially called the Phase 3 Retail Round 2 Lottery, comes after a California federal judge declined to issue a temporary restraining order sought by a would-be applicant from Michigan to stop the process from moving forward, according to a Law360 report.
U.S. District Judge Sherilyn Peace Garnett issued a written opinion Dec. 8 that said Kenneth Gay and his company, Variscite Inc., could not prove that allowing the DCR’s lottery to proceed would “irreparably harm them or be in the public interest,” Law360 reported.
“Plaintiffs’ monetary losses associated with the challenged provisions are purely speculative and insufficient to demonstrate irreparable harm,” Garnett wrote, according to the outlet. She added, “The probability that plaintiffs may in the future become eligible under the licensing provisions eviscerates the likelihood of irreparable harm.”
Garnett wrote that the harms suffered by the 508 applicants cleared to participate in the lottery should it be put on hold outweighed the harms suffered by the plaintiffs should their application be denied, according to Law360.
Gay claimed in his complaint, filed Nov. 30, that the DCR’s process of awarding the dispensary licenses to social equity applicants violates the dormant commerce clause, a constitutional provision that prohibits policies that favor in-state residents, Law360 reported.
Garnett noted that “the plaintiffs, at a minimum, have raised serious questions on the merits of their claim regarding the constitutionality of the challenged provisions,” according to the outlet, and found that Gay and his company lacked standing because the application was rejected for additional reasons beyond the scope of the social equity provisions.
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