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Craft cannabis applicants fighting court injunction against new licenses in Illinois

Cannabis license applicants and Illinois officials are scrambling to change a court order after a judge prohibited the state from issuing up to 60 new craft grower licenses that were due out by Dec. 21.

Cook County Judge Neil Cohen issued an injunction Nov. 22, preventing the Department of Agriculture from issuing the licenses “until further order of the court.”

The order follows a similar order from Cook County Judge Moshe Jacobius preventing the awarding of 185 new marijuana retail store licenses until litigation over some of the licenses is resolved — which could take months or years.

Cannabis licenses had already been delayed more than a year by the state after complaints that the application scoring process had been badly mishandled by contractor KPMG. Some identical applications had been scored differently, applicants said, and many applicants had not been told additional information they needed to provide, as had been required by the law.

The continued delay means that applicants will continue to burn through money to retain real estate, employees and attorneys, while being prevented from opening and earning money. Most of the applicants are deemed “social equity,” who were supposed to be favored in licensing because they came from areas with high poverty and crime rates, or had been arrested for low-level marijuana offenses.

This summer, the state awarded 40 craft grower licenses, and disqualified some other applicants for unknown reasons.

The craft grower court case involves applicants suing because they were disqualified. In addition, seven applicants have filed a motion to intervene, asking to lift the injunction and award the remaining licenses, so applicants know whether they have won a license or not.

Those applicants filed a request for the judge to modify his court order to issue the remaining licenses by Dec. 21, as required by state law.

“There’s a deadline people have relied upon that needs to be respected,” attorney Ryan Holz said. “It’s just a massive holdup. … Every day that goes by, these people are going to fall further and further behind.”

Illinois Attorney General Kwame Raoul’s office argued in court briefings that the order should be modified so that the Department of Agriculture could announce new licensees, but not issue them. That would make clear the winners and losers, and clear the way for any other unsuccessful applicants to join the litigation.

Cohen’s injunction came in the case of ia GP LLC vs. the Department of Agriculture and its director, Jerry Costello II. In his court order, Judge Cohen also prevented ia GP’s disqualification from taking effect until further court order. That case was subsequently consolidated with other craft grower cases in Sangamon County.

In response to the questions from the Tribune, Gov. J.B. Pritzker spokesperson Charity Greene sent an email stating that the Pritzker administration “has prioritized equity and accessibility” in the cannabis industry, while seeking to announce the next round of craft grow winners.

“While the issuance of those licenses remains on hold due to a court order, the administration remains committed to helping applicants from diverse backgrounds enter and remain part of the state’s cannabis industry,” Greene said.

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