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New court ruling could put crimp in profits for one Missouri medical marijuana company

New court ruling could put crimp in profits for one Missouri medical marijuana company

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JEFFERSON CITY — A company hired to manage part of Missouri’s medical marijuana program lost a legal challenge Friday that could put a damper on how much it earns from its contract.

In a 16-page decision, Cole County Circuit Judge Daniel Green said Lakeland, Florida-based Metrc could not charge separate fees to the state and to privately operated cannabis dispensaries on top of the $5 million contract it won to oversee the licensing of companies and the tracking of pot from the seed stage to the sale of the finished product.

Green said there is nothing in state bidding documents suggesting the company would be able to charge the added fees.

“To the contrary, it explicitly barred the winning bidder from accepting any payments other than those contained in its pricing proposal,” Green wrote.

The case is the latest lawsuit associated with the state’s rollout of medical marijuana. Companies from across the nation have descended on Missouri hoping to cash in on the potentially lucrative business.

Green’s decision came after another company seeking the contract raised questions about Metrc’s bid because, by charging separate fees, they could have submitted a lower price to the state than other companies.

Metrc, which manages pot programs in 11 other states, outbid 20 companies for the contract.

In some states, different companies handle the various aspects of operating a medical marijuana program. But Missouri wants one company to do most of the information technology set-up for its licensing and tracking system.

The state agency that oversees most contracting in Missouri issued a ruling in May saying the contract would not allow Metrc to charge those fees, despite a separate rule issued by the Department of Health and Senior Services that said such fees would be allowed.

Metrc did not have an immediate response to the decision. But state officials say it will not impede the rollout of the program.

“A contract between Metrc and the State of Missouri continues to exist and we expect this ruling, regarding what the contract allows relating to charging for tags, to have no impact on the medical marijuana program,” said DHSS spokeswoman Lisa Cox.

Voters approved Amendment 2 in November 2018, making Missouri the 33rd state to legalize marijuana for medicinal use. Sales are to start in the coming months. Tax proceeds and licensing fees are supposed to go into a newly created veterans health care fund, which is expected to generate about $20 million per year.

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