GTI Maryland Sues Maryland Medical Cannabis Commission for Illegally Removing Pre- Approval of GTI's Grower License That Was Based on Expert Review

BALTIMORE, Sept. 20, 2016 /PRNewswire/ -- GTI Maryland, LLC announced at a press conference today that it has filed a lawsuit against the Maryland Medical Cannabis Commission (MMCC) and each of its 16 Commissioners for illegally removing GTI from the list of companies that had received pre-approval for opening cannabis grower operations in the state.

At the press conference, GTI officials and their attorneys described a closed-door reversal of a unanimous 5-0 vote by a Commission subcommittee on July 27, 2016 to recommend GTI and 14 other growers for licenses. Those 15 applicants, including GTI, had been rated the top picks based on an objective, "double-blind" evaluation conducted by Towson University's Regional Economic Studies Institute (RESI).

On July 29, just 48 hours later -- and without explanation -- 4 of 5 members of the subcommittee changed their votes and substituted two groups that failed to make the top 15 in place of GTI and another applicant that had made the top 15.

See attached for key facts. To obtain a copy of the complaint, please contact Eleanor McManus of Trident DMG at [email protected].

"We are filing this lawsuit because the Commission's removal of GTI from the top 15 list was improper and illegal," said Pete Kadens, CEO of GTI Maryland. "We earned pre-approval for a license, and we want what is rightfully ours. Any further delay will only hurt patients who need medical cannabis to ease their suffering."

"We want to know what happened in the 48 hours between July 27 and 29 to cause the subcommittee's turnabout," said GTI Maryland General Manager and businessman Sterling Crockett, Sr. "We want full transparency and disclosure about all contacts with subcommittee members during that time. We want to know if members spoke with or heard from anyone who caused them to change their minds."

Phil Andrews, an attorney for GTI at Baltimore law firm Kramon & Graham, noted that, on October 13, 2015 in response to questions from applicants, the Commission assured in published FAQ that "geographic diversity" would not be a factor for winning grower license pre-approval. Applicants relied on those responses, and the application requested no information about geography.

Yet, at the August 5, 2016 public Commission meeting, the MMCC subcommittee's stated reason for its course reversal was "geographic diversity," contradicting the Commission's own pronouncements and representations.

"There was no advance notice that the Commission and subcommittee had decided to change the rules, which GTI and other applicants relied on, after the game had been played," Andrews said.

Maryland legalized medical marijuana in 2013, and the MMCC is charged with reviewing applications for licenses to grow, process and cultivate cannabis for medical purposes. By statute, the state can allot only 15 licenses for growers until June 2018.

GTI Maryland applied for one of the 15 grower licenses in 2015 with operations to be located in Washington County. GTI immediately began to invest in its efforts and to work with local community leaders, who are supportive of GTI's application for a license.

GTI has a national track record of delivering treatment and patient care through medical cannabis. The company has dispensary and cultivation licenses, operations or partnerships in Illinois, Massachusetts, and Nevada, including six dispensary licenses and four cultivation licenses across these three states. In Illinois, GTI has served thousands of patients.

The lawsuit, which was filed Monday in Baltimore City circuit court, names as defendants the MMCC, the Maryland Department of Health and Mental Hygiene, and all 16 Commissioners, including: MMCC Chairman Paul W. Davies; Dario Broccolino, the State's Attorney for Howard County; John Gontrum, Assistant Comptroller of Maryland; Colonel Harry Robshaw, III, the Chief of Police of the Cheverly Police Department; and Allison W. Taylor, the Director of the Office of Governmental Affairs in the Maryland Department of Health and Mental Hygiene.

Andrews leads the litigation with former White House Special Counsel Lanny Davis serving as of counsel.

Davis joined Andrews, Kadens and Crockett at the press conference, along with former Baltimore Ravens player Eugene Monroe, who is a prominent educator on the benefits of medical cannabis and a GTI Maryland investor.

"We are asking the court to order the Commission to immediately restore GTI Maryland to its place on the list of 15 companies that were pre-approved for licenses," Andrews said.

Lanny Davis, a co-founder and partner at Davis Goldberg & Galper in Washington, D.C., said, "GTI asks for full disclosure and transparency from the Commission's subcommittee about why, within 48 hours, 4 of 5 members abandoned their unanimous acceptance of the merits-only list of 15 and instead substituted two lesser-ranked applicants."

Added Davis: "Without making any prejudgments, we want to know about all external conversations and contacts, if any, among the following: subcommittee members; the two lower- ranked companies; and lobbyists and representatives for those two companies. In addition, we ask whether the full Commission, which unanimously approved the subcommittee's revised list on August 5, was fully informed about any of those contacts before its vote. This is not a matter that should be restricted to the courtroom. Marylanders deserve answers."

Kadens commented: "We cannot lose sight of the fact that the real victims here are Maryland patients. They deserve access to the highest-quality treatment cultivated and delivered by the strongest companies. By allowing lesser-qualified applicants on the pre-approval list such as the company that replaced GTI, the Commission is preventing patients from getting the best care possible."

FACT SHEET

October 13, 2015: The Maryland Medical Cannabis Commission (MMCC), in its published responses to specific questions, stated that geographic considerations were "not relevant" to win pre-approval for a cannabis grower license, and, "[t]herefore, identification of multiple potential site locations is not necessary or helpful to the Commission at this stage." The MMCC also stated in another published response on the same day: "An applicant does not need to demonstrate that they are promoting geographical diversity in their choice of premises." GTI and other groups relied on those responses in preparing their applications.

November 6, 2015: Deadline for applicants to submit applications for medical cannabis grower licenses.

July 27, 2016: The MMCC's grower subcommittee voted unanimously (5-0) to grant pre- approvals for licenses to the top 15 ranked applicants as identified in an objective, merits-based list compiled by Towson University's Regional Economic Studies Institute ("RESI") after a months-long, "double-blind" review, scoring and ranking of the applications. This list included GTI, which ranked #12, and another entity that ranked #8.

July 29, 2016: 4 of 5 members of the grower subcommittee changed their votes and replaced GTI (#12) and the #8-ranked entity with two substantially lower-rated companies (#20 and #21). The subcommittee's chairman, Harry Robshaw, later said geographic considerations were the reason – contradicting the October 13, 2015 MMCC statement relied on by all applicants prior to submitting their applications.

August 5, 2016: The Commission unanimously voted on the subcommittee's July 29 list that resulted from the subcommittee's decision to reverse course and reject RESI's subject matter expert selection of the 15 best grower applications.

Contact:

Eleanor McManus
[email protected]
202-460-1451 cell

SOURCE GTI Maryland