Former State Sen. Ricky Hendon denounced the Sozo Health lawsuit to delay the dispensary lottery on Tuesday, July 27, 2021. "I call them, So-Low Health," he said. Credit: Mike Fourcher / Grown In
Part [part not set] of 12 in the series Illinois’ Dispensary Licenses in Court

Part 7 of 12 in the series Illinois’ Dispensary Licenses in Court

Today’s Illinois dispensary lotteries will proceed and winners can be announced, but the winners cannot be actually awarded their licenses until after an August 9 court hearing, a Cook County Circuit Court judge ordered late Wednesday afternoon.

The emergency order was handed down as three lawsuits came to a head with hours to spare before Illinois’ first dispensary lotteries were to be conducted. The stay on awarding licenses is part of a long running lawsuit, Wah v. IDFPR, and was a response to Illinois cannabis regulators sending out final dispensary license scores Wednesday afternoon, say court filings.

The order, from Judge Moshe Jacobius, applies to both today’s Qualifying Applicant Lottery and the Social Equity Justice Involved Lottery scheduled for August 5. The Wah v. IDFPR case, filed by a group of social equity dispensary applicants, charges that the veteran’s bonus points tallied in the dispensary application scoring process creates a special class of applicants, which is illegal under the Illinois constitution.

[Download the Wah v. IDFPR order staying award of licenses]

Meanwhile, bowing to growing public pressure, a federal lawsuit filed by Michigan-based cannabis company Sozo Health, was dropped Tuesday, hours before a judge was to rule on whether or not to stall today’s scheduled Illinois dispensary lottery. And then also on Wednesday afternoon, an unrelated lawsuit in Cook County Circuit Court demanding a temporary restraining order (TRO) filed by dispensary applicants Hempathy LLC, Truerb LLC, and Leafsie LLC, was denied a TRO and stayed until December by a judge.

The federal lawsuit filed by Sozo Health in the Illinois Northern District claimed the law creating the lotteries violated the federal Constitution’s commerce clause because it bars non-Illinois residents from receiving certain licenses. 

The Cook County case, Hempathy v. IDFPR, claims that the three companies attempted to cure problems with the applications during the deficiency process, but their logins to a contractor-managed website did not work, and that their emailed requests for assistance to the Illinois Department of Financial and Professional Regulation (IDFPR) went unanswered. Attorneys for the State of Illinois argued that because it was a computer “glitch”, a TRO is not warranted, and a remedy should be sought after the lottery is conducted.

[Download the Hempathy v. IDFPR complaint]

The Sozo lawsuit drew a great deal of attention on social media this week and on Tuesday morning, a group of cannabis equity advocates held a press conference in front of the Everett Dirksen Federal Courthouse in downtown Chicago. The advocates’ presser focused less on the legal merits of Sozo’s case, and more painting Sozo as an outsider mucking up a good thing.

“We cannot have these carpetbaggers come into Illinois that are not serious about diversity, that will blatantly lie about diversity and inclusion efforts,” said Chicago NORML executive director Edie Moore, after claiming Sozo has not participated in diversity outreach efforts sponsored by her group. “They don’t want to see true racial social equity.”Sozo’s complaint, which focused on the fact that out-of-state applicants are not allowed to participate in some of the lotteries, has had a track record of success with similar suits in other states, including cases in Missouri, Detroit, Michigan, and Portland, Maine.

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Editor Mike is a co-founder and the editor of Grown In, a U.S. national cannabis industry newsletter and training company. His career has taken him from Capitol Hill to Chicago City Hall, from...