In a case that addresses the bounds of administrative ability, the Alabama Court of Civil Appeals recently heard an appeal arising from the heart of Montgomery County. This case, Verano Alabama, LLC v. Alabama Medical Cannabis Commission, delves into the sources of administrative authority, defining the powers of an administrative body through multiple grounds.
On June 12, 2023, the Alabama Medical Cannabis Commission (AMCC) awarded Verano an integrated facility license. The medical cannabis industry in Alabama is governed by the Darren Wesley Hall Compassion Act, which allows the AMCC to issue no more than five of the integrated facility licenses. Verano promptly paid the licensing fee, but AMCC did not issue the license. Instead, on June 16, AMCC stayed the issuances of the previously awarded licenses, citing concerns over the accuracy of its scoring procedure on the applications for the licenses.
When Verano still had not received the license several months later, it filed a complaint seeking judicial review of the “improper voiding of the licenses it previously awarded.” Verano’s argument was based on a portion of the Alabama Administrative Procedure Act (the AAPA) found in §31-22-20 of the Alabama Code. Verano asserted that the Act, as well as the regulations promulgated by AMCC, did not grant the authority to “void” a license award without citing further legal authority. Accordingly, Verano requested that the court reverse the decision to rescind and order the issuance of the license.
The circuit court disagreed with Verano, citing three sources of the AMCC’s authority. First, the AMCC has an inherent authority to reconsider its own licensing decisions, and to correct errors within those decisions. Additionally, under the Alabama Administrative Code §538-X-3.17 and §528-X-3-18;9, the AMCC is granted an express authority to stay the awards, which subsequently implies its authority to void the awards. Finally, the AMCC had validly adopted an edition of Robert’s Rules of Order that provided the AMCC with procedural authority to rescind its prior decision.
On appeal, Verano attacked the first two sources of the AMCC’s authority but failed to raise any arguments against the third and final source. Subsequently, the Court found that Verano had waived any argument challenging the lawfulness of AMCC’s decision to rescind the award of the license.
Verano Alabama, LLC v. Alabama Medical Cannabis Commission illustrates the wide array of sources granting administrative power. All three grounds the Court cited as granting the AMCC’s authority were vastly different, demonstrating the power can be derived from a wide array of origins.
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