420 with CNW — Medical Cannabis Firm Sues Oklahoma over Tracking System

DR Z Leaf dispensary in the state of Oklahoma recently filed a suit in an attempt to stop the execution of a cannabis tracking program in the coming weeks. The litigation, which was filed by the medical cannabis operator, also disputes whether the state’s Department of Health is operating ultra vires by implementing the seed to sale system and making it mandatory for more than 10,000 medical marijuana businesses to pay for it.

The business filed the suit in the District Court of the Okmulgee County last week and questions the legality of the contract between Metrc, an organization based in Florida, and the state of Oklahoma.

The lawsuit demonstrates the strain in the relationship of the state and some medical cannabis businesses over the growing number of regulations and the costs of observing those regulations. According to the state, as of March 2, there are 10,587 active medical cannabis business licenses in throughout the state.

The state established its medical marijuana market in 2018. Since then more regulations have been introduced in an attempt to meet the industry’s best practices.

Oklahoma Medical Marijuana Authority (“OMMA”) spokeswoman Terri Watkins stated in an interview last week that the state did not comment on unsettled lawsuits. Bronwyn Flores, the spokeswoman for Metrc, also refused to comment on this litigation, which has listed OMMA and the state as defendants.

An affiliate of Fox TV in the state, KOKH, mentioned that a few medical marijuana business operators had complained about the seed tracking program and, in particular, the prices imposed by Metrc. For instance, wholesalers are charged 25¢ per package for an RFID tag while cultivators are charged 45¢ per plant for the same.

Flores stated that the fees for plant tags and the company’s software were the same in the 16 markets the company served. Metrc is party to seed-to-sale contracts in fifteen states, including Washington, DC, and Oklahoma.

These tracking programs in legal cannabis markets are provided by a solo software provider in order to ensure that inventory tracking can be performed through a centralized system. A competitive bidding process is used to award contracts. The company’s system will be replacing the compulsory monthly reports that medical cannabis businesses in the state of Oklahoma were submitting.

The transition from a manual to an electronic system may have been costly for some businesses, given that many of them were doing their reports on paper. Flores explained that entering an established market comes with its own set of issues but added that, from the company’s view, execution had been running smoothly.

Licensed marijuana sector players in different parts of to lots of complicated regulations, and it no wonder that some sector actors in Oklahoma are protesting the frequent changes to the laws governing their activities.

NOTE TO INVESTORS: The latest news and updates relating to Gage Growth Corp. (CSE: GAGE) (d.b.a. Gage Cannabis) are available in the company’s newsroom at https://cnw.fm/GAGE

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