Work With a Cannabis Business Lawyer on Your State Application

Regardless of your background, education, experience, or area of expertise, you need someone who is neutral and impartial to assist with and review your Step 1 (pre-qualification) and Step 2 (facility license) applications prior to submission. Just because you could prepare the required disclosures and narratives in the application by yourself doesn’t mean that you should. It’s always good to have an expert to make certain for what’s disclosed in the cannabis business state license application and how to best respond and cure any deficiencies. And the same goes for after you obtain your license to make sure you keep it. Ou recommendation is that you work with a proven cannabis state license lawyer.

Do you want to apply for your cannabis business state application? Interested in speaking with a cannabis state license lawyer? Request a consultation now.

I’ve discussed the Top Reasons Why Your State Application Will Be Denied based on the criteria set forth in the Medical Marihuana Facilities Licensing Act (“MMFLA”)/Emergency Rules.

Following my review of the law and rules, I offered readers three helpful suggestions for increasing the likelihood that the State of Michigan Department of Licensing and Regulatory Affairs (“LARA”) and the Medical Marihuana Licensing Board will approve your application:

1. Submit a Complete Application with All Supporting Documentation.
2. Go Above and Beyond the Application Requirements and Provide Explanations when Necessary.
3. Plan Out and Document Every Detail of your Facility and its Standard Operating Procedures.

The issue with applying without any third-party assistance is that it will inevitably result in different interpretations of what information and supporting documentation must be disclosed by each person who’s required to fill out an application.

A knowledgeable third party can dig deeper into each individual’s history, and someone who isn’t connected to the application has a greater chance of identifying any blind spots or recognizing any omissions in the application that would otherwise go unnoticed or undiscussed among the members of the company.

This requires that each individual applicant be open to honest communication and full transparency with the third party, but there should be the expectation at the beginning of the application that everyone should be one hundred percent truthful with both LARA and the other members of the company regarding their financials, tax history, criminal history, and every other required disclosure.

Disclosing sensitive or embarrassing background information to close friends, family, or your business partners may be difficult and sharing that information with a third party may make you uncomfortable, but anything less than full disclosure presents too high of a risk that your application will be denied for failure to disclose.

The Application is a Test

There’s no question that each application and every individual’s disclosures, supplemental documentation, and narratives have been – and will continue to be – thoroughly examined and highly scrutinized by LARA and the Licensing Board before an applicant is granted approval for a state operating license.

The cannabis industry in Michigan will require strict regulatory compliance and accountability by licensees.

The application process is the first opportunity to demonstrate to the State of Michigan that you’re qualified to operate a cannabis business by following all of the instructions and satisfying all of the requirements.

A third party has the ability to hold every individual on the application accountable for all the information and supporting documentation that must be disclosed.

Do you want to apply for your cannabis business state application? Interested in speaking with a cannabis state license lawyer? Request a consultation now.

Dealing with Deficiencies

In addition to the initial application submissions, LARA and the Licensing Board have been – and will continue to be – justifiably sensitive to the manner in which every individual on the application responds to any identified deficiencies and requests for additional information or documents.

The Licensing Board has the authority to deny an application if the applicant made a material misrepresentation on the application and failing to disclose certain information could shed a negative light on an individual’s integrity, moral character, and reputation.

Third-party assistance and review during the application process can decrease the chances of anyone unintentionally (or intentionally) failing to disclose.

Additionally, a third party who is familiar with the application process and what information LARA does (and doesn’t) require to be disclosed can better assist with properly responding to any deficiencies to decrease the chances that the Licensing Board will deny an application based on the Board’s belief that there was material misrepresentation or their concerns about an individual’s integrity, moral character, and reputation.

The Never-Ending Application Process: Continuing Duty to Report

If the application process is a test, then the indefinite and never-ending time period after obtaining a license is the final exam.

Rule 14 of the Emergency Rules explains that there’s “a continuing duty” to provide up-to-date information and report all material and non-material changes to LARA.

In fact, all material changes, such as a change in membership and management of the company and any attempted sale or transfer of a license must be reported immediately within one (1) business day.

Licensees must also immediately report any adverse reactions to marihuana product, any criminal convictions or civil judgments, and any regulatory disciplinary action.

Municipalities typically have similar reporting requirements in their ordinances.

The Consequences of Failure to Report: Losing your License

Failure to report may result in sanctions or fines, or both, including the suspension or revocation of your license.

It would be irresponsible to waste all the time, money, and resources necessary to obtain a license only to have it stripped away by LARA for failure to report.

A third party who’s not busy running the company and isn’t distracted from dealing with day-to-day operations may be in a better position to document the entire application process from start to finish by maintaining records of every single disclosure in the application submitted to LARA.

With a third party assisting, you also have a greater chance of keeping up-to-date on when you need to update your application and facility plan based on the reporting requirements.

Final Thoughts

Overall, the application process and the requirements to maintain a license shouldn’t be taken lightly.

Each step of the process has different requirements and presents different challenges that can be avoided by taking the necessary precautions to reduce the risk that you’ll be denied or lose your license.

Whether you decide to retain the services of an attorney or law firm, business advisor, consultant, or another trusted third party, every applicant and licensee should seriously consider the importance of having someone else help you throughout the application process and beyond rather than taking the risk on your own.

Do you want to apply for your cannabis business state application? Interested in speaking with a cannabis state license lawyer? Request a consultation now.