In re Medicinal Marijuana Alt. Treatment Ctr. for Impel Dig. LLC, DOCKET NO. A-1272-19
| Decision Date | 18 February 2021 |
| Docket Number | DOCKET NO. A-1747-19,DOCKET NO. A-1281-19,DOCKET NO. A-1656-19,DOCKET NO. A-1283-19,DOCKET NO. A-1272-19,DOCKET NO. A-1285-19,DOCKET NO. A-1275-19,DOCKET NO. A-2166-19,DOCKET NO. A-1284-19,DOCKET NO. A-1744-19,DOCKET NO. A-1416-19,DOCKET NO. A-1766-19,DOCKET NO. A-1743-19,DOCKET NO. A-1754-19,DOCKET NO. A-1286-19 |
| Parties | IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR TETRA GROW, LLC (SOUTH) IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR LIBERTY PLANT SCIENCES (NORTH) IN THE MATTER OF THE APPLICATION FOR MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR PROGRESSIVE TREATMENT SOLUTIONS OF NEW JERSEY, INC. (CENTRAL) IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR GARDEN STATE OPERATIONS, LLC (CENTRAL) IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR GARDEN STATE OPERATIONS, LLC (NORTH) IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR CANNWELL, LLC IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR CORE EMPOWERMENT NJ LLC IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR AUGUST TENTH CAPITAL INVESTMENTS, LLC (NORTH) IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR COMMUNITY WELLNESS OF NEW JERSEY LLC (CENTRAL) IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR IMPEL DIGITAL LLC (NORTH) IN THE MATTER OF THE APPLICATION OF MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR IMPEL DIGITAL LLC (SOUTH) IN THE MATTER OF THE APPLICATION FOR MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR ZY LABS, LLC IN THE MATTER OF THE APPLICATION FOR MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR PG HEALTH LLC (SOUTH) IN THE MATTER OF APPLICATION FOR MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR LEGENDARY WELLNESS NJ, LLC IN THE MATTER OF APPLICATION FOR MEDICINAL MARIJUANA ALTERNATIVE TREATMENT CENTER FOR MARINUS HOLDINGS, LLC (SOUTH) |
| Court | New Jersey Superior Court — Appellate Division |
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
Before Judges Fisher, Moynihan and Gummer.
On appeal from final agency decisions of the New Jersey Department of Health.
Joshua S. Bauchner argued the cause for appellants Tetra Grow LLC, Liberty Plant Sciences, LLC, Garden State Operations LLC, Cannwell LLC, Core Empowerment LLC (Ansell Grimm & Aaron, P.C., attorneys; Joshua S. Bauchner, of counsel and on the briefs; Rahool Patel, on the briefs).
Cameryn J. Hinton argued the cause for appellant Progressive Treatment Solutions of New Jersey, Inc. (Greenbaum, Rowe, Smith & Davis LLP, attorneys; Luke J. Kealy, Cameryn J. Hinton, Jack J. Fersko and Steve Firkser, on the briefs).
Craig S. Provorny argued the cause for appellant Community Wellness of New Jersey LLC (Herold Law, P.A., attorneys; Craig S. Provorny, on the briefs).
Lee Vartan argued the cause for appellant ZY Labs, LLC (Chiesa Shahinian & Giantomasi PC, attorneys; Lee Vartan, Brian P. O'Neill and James R. Hearon, on the briefs).
Ansell Grimm & Aaron, P.C., attorneys for appellants, Impel Digital LLC, and Marinus Holdings, LLC,(Joshua S. Bauchner, of counsel and on the briefs; Rahool Patel, on the briefs).
Edward N. Tobias, attorney for August Tenth Capital Investments LLC.
Lauletta Birnbaum, and Krishna B. Narine, of the Pennsylvania bar, admitted pro hac vice, attorneys for appellant PG Health LLC (Steven Doto and Krishna B. Narine, on the briefs).
Matthew T. Priore, attorney for appellant Legendary Wellness, LLC.
Jacqueline R. D'Alessandro, Deputy Attorney General, argued the cause for respondent New Jersey Department of Health (Gurbir S. Grewal, Attorney General, attorney; Melissa H. Raksa, Assistant Attorney General, of counsel; Jacqueline R. D'Alessandro, Deputy Attorney General, on the briefs).
These appeals - some consolidated and the remainder scheduled back-to-back - require our consideration of final agency decisions that disqualified appellants' applications for permits to operate medicinal marijuana Alternate Treatment Centers (ATCs). Unlike the issues considered in a decision rendered earlier this term3 - when we considered challenges to the Department of Health's scoring of ATC applications - the arguments presented here question finalagency decisions that found appellants' applications were not eligible to be scored for several reasons. Excluding ZY Labs, LLC's appeal, we affirm the final agency decisions under review. As for ZY Labs, we reverse and remand to the Department of Health for further proceedings.
By way of background, we note that the Compassionate Use of Medical Marijuana Act4 provides qualifying patients, their caregivers, and those authorized to produce, process, and dispense marijuana pursuant to its terms, with protection from arrest, prosecution, and other penalties when possessing marijuana for medical purposes. N.J.S.A. 24:6I-2(e); N.J.S.A. 24:6I-7. The Compassionate Use Act charges the Department of Health with implementing New Jersey's Medicinal Marijuana Program (the Program). N.J.S.A. 24:6I-3; Pangaea Health & Wellness, ___ N.J. Super. at ___ (slip op. at 6); Natural Med., Inc. v. N.J. Dep't of Health & Senior Servs., 428 N.J. Super. 259, 262 (App. Div. 2012). This includes establishing a registry of qualified patients and issuing permits for the operation of ATCs. N.J.S.A. 24:6I-4; N.J.S.A. 24:6I-7.1; Pangaea Health & Wellness, ___ N.J. Super. at ___ (slip op. at 6); Natural Med., 428 N.J. Super at 262. N.J.S.A. 24:6I-7(a)(3) requires that the Department "seek to ensure" the availability of a sufficient number of ATCs throughout the State, pursuant to need, and that the Department must issue permits for "at least two [ATCs] each in the northern, central, and southern regions of the State." Beyond the mandated minimum of six ATCs, the Department was imbued with "discretion to determine how many ATCs are needed to meet the demand for medicinal marijuana and whether the issuance of a permit to a particular applicant would be consistent with [legislative] purposes." Pangaea Health & Wellness, ___ N.J. Super. at ___ (slip op. at 7); Natural Med., 428 N.J. Super at 263. The Department has promulgated regulations, N.J.A.C. 8:64-1.1 to -13.11, that provide the framework through which it issues requests for applications (RFAs) for the operation of ATCs.5 Pangaea Health & Wellness, ___ N.J. Super. at ___ (slip op. at 7).
In January 2018, Governor Murphy issued Executive Order 6, which directed the Department to review the Program with a goal toward expanding access to medicinal marijuana. To that end, in March 2018, the Department added five new conditions to the list of those qualifying for treatment, causing a rapid increase in qualified and registered patients.
To ensure adequate service to the growing population of qualified patients, the Department issued, on July 16, 2018, a second RFA to select six more entities for V-I ATC permits. After a committee scored all responsive applications - more than 100 - the Department chose six applicants on December 12, 2018. Recently, we agreed with the argument of several unsuccessful applicants that there were flaws in the process and remanded for further proceedings. Pangaea Health & Wellness, ___ N.J. Super. at ___ (slip op. at 17, 74).
The appeals now before us concern the RFA issued by the Department in July 2019. The Department rejected applications submitted electronically by appellants Tetra Grow LLC, Liberty Plant Sciences, LLC, Garden StateOperations LLC, Cannwell LLC, Core Empowerment NJ LLC,6 and Legendary Wellness, LLC, because the Department could not open attached files. The Department also rejected applications from appellants Impel Digital LLC, and Community Wellness of New Jersey LLC, because they were not timely submitted. And, the Department rejected the applications of appellants Progressive Treatment Solutions of New Jersey, Inc., ZY Labs, LLC, PG Health LLC, Marinus Holdings, LLC, and August Tenth Capital Investments, LLC, because they were found to be unresponsive on one or more RFA criteria. With one exception, we reject appellants' arguments.
The July 2019 RFA described the two parts of the application. Part A, titled "Mandatory Information," was presented as "a fillable PDF form that contains all the required information about the business entity that is applying for a permit."7 The required information included: the applicant'sorganizational documents; "evidence that the business entity is in good standing with the New Jersey Department of the Treasury"; a valid Business Registration Certificate; information about principal officers, directors, owners, and board members; a list of all persons or business entities having five percent or more ownership in the applicant entity; "[w]ritten verification of the approval of the community or governing body of the municipality in which the [ATC] . . . will be located"; "evidence of ownership or lease of the proposed site"; and evidence of compliance with local codes and ordinances.
Part B consisted of the "Scored Criteria" on which applicants would be judged. These criteria asked applicants to describe their proposed operations, experience, security and quality control plans, financing, and other aspects of running an ATC. Applicants were directed to file a PDF or printed document not exceeding 100 pages for each endorsement they sought, for Part B. V-I applicants were required to submit three Part B documents, one for each aspect of the V-I endorsement set.
The Department advised that applications could be ...
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