Pennsylvania court dismisses another challenge to medical marijuana program

A Pennsylvania appellate court has passed up another opportunity to judge the fairness of the state Department of Health’s medical marijuana permitting process.

The Commonwealth Court on Friday dismissed a lawsuit filed by Elemental Health Group LLC against the Health Department and permit winner Terrapin Investment Fund 1 LLC.

Elemental Health, of Conshohocken, last year applied unsuccessfully for a permit to operate a growing and processing facility in central Pennsylvania. But Elemental claimed it should have earned a higher score than one of the regional permit winners, Terrapin, because the Health Department’s evaluation committee allegedly awarded Terrapin points for misrepresenting where Terrapin planned to open its Clinton County facility.

Applicants were awarded points for choosing facility locations in financially distressed municipalities as defined by a state law called Act 47. According to its application and court records, Terrapin said it was opening a facility in a financially distressed municipality even though the community in question, Pine Creek Township, is not considered a financially distressed municipality under Act 47.

The Health Department awarded 12 grower/processor permits and 27 dispensary permits in June 2017. Within two weeks, Elemental Health (among 140 other unsuccessful applicants) filed an administrative appeal with the Health Department disputing the denial of its permit application. It argued that Terrapin’s application should have been disqualified for application inaccuracies — leaving Elemental Health, the next highest scorer in the region, with the permit.

Like Bethlehem-based Keystone ReLeaf, Elemental Health argues that the Health Department has not provided an adequate administrative appeal process. Hearing officers overseeing administrative appeals have prohibited unsuccessful applicants from focusing on content in competitors’ applications; each unsuccessful applicant must convince hearing officers that the evaluation committee misscored its particular application, not competitors’.

Consequently, Elemental Health was “precluded from presenting the thrust of its argument” related to

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