Judge: New Mexico rules on medical cannabis overstep law

Dillon Mullan, The Santa Fe New Mexican
·4 min read

May 5—A state district judge on Monday ruled the New Mexico Department of Health has been overstepping the Legislature's intentions for the Medical Cannabis Program by limiting who can receive patient cards.

The ruling comes in a complaint filed by New Mexico Top Organics-Ultra Health, the state's largest medical cannabis producer. First District Judge Matthew Wilson heard arguments April 28 in the case, in which Ultra Health contended more than 5,000 people, most from out of state, were being wrongly denied access to medical cannabis.

"The department prevents enrollment if they present identification and authorization from different jurisdictions," state Sen. Jacob Candelaria, D-Albuquerque, an attorney representing Ultra Health, said in last week's hearing. "The department may think this is good policy, but it is a decision that is beyond the scope of their rule-making authority, and as a result, hundreds of patients a day are unable to access cannabis in New Mexico."

State statute says someone with proof of authorization in a medical cannabis program in another state can purchase cannabis in New Mexico and be enrolled in the Department of Health's database as a so-called reciprocal patient.

According to Wilson's ruling, the department made a rule change in March and began barring reciprocal patients with IDs from other states from enrolling in New Mexico's patient program and also began denying New Mexico residents from enrolling as regular patients if they otherwise would qualify as reciprocal patients.

"We are in receipt of the writ and the NMDOH is considering legal options," Department of Health spokesman Jim Walton said in an email.

The Department of Health also has an appeal pending of Wilson's ruling in a similar case Ultra Health filed last year over rules on reciprocal patients.

Wilson in October overturned an "emergency" rule change the agency made in September, saying there was no reason to alter the reciprocity rule without a regular process. The Department of Health appealed the ruling to the New Mexico Court of Appeals and later altered the reciprocity rule through a standard process.

Asked whether the appeal will continue, Walton wrote, "The NMDOH doesn't control whether a district court case will continue and we have no immediate plans to dismiss any of the pending appeals."

Thomas Bird, an attorney with Keleher & McLeod who has been representing the Department of Health in numerous medical marijuana cases, argued at last week's hearing the agency had the authority to enforce regulations.

"I think Ultra Health is beating a square peg into a round hole," Bird said. "The Legislature left to the department the discretion to make judgment calls about what kind of restrictions are appropriate."

Duke Rodriguez, CEO of Ultra Health, lauded Wilson's decision this week. "While the NMDOH has not been compassionate in respecting the full rights and needs of patients, thankfully the courts have repeatedly held them accountable," he said. "The law is clear, and patients' rights cannot simply be set aside by a regulator."

Ultra Health, which operates 25 dispensaries statewide and said in a news release it plans to open another 10 stores this year, has sued the Department of Health multiple times over Medical Cannabis Program rules and gross receipts taxes on products for patients.

Most recently, state District Judge Bryan Biedscheid in February ordered the department to roll back regulations made without consulting the New Mexico Medical Cannabis Advisory Board as required under state law.

New Mexico Health Secretary Dr. Tracie Collins filed an ethics complaint in March accusing Ultra Health's attorney, Candelaria, of misconduct for voting on legislation she said would have a direct effect on the company and lead to personal gain for the senator. The State Ethics Commission dismissed the complaint, saying it didn't have jurisdiction over complaints regarding Senate rules.

Following Wilson's ruling Monday, Candelaria filed a notice of his intent to sue Collins, alleging the ethics complaint was filed in retaliation for his request for public records related to the state's response to COVID-19.

In June, licensing for cannabis providers is shifting from the Department of Health to the Regulation and Licensing Department's Cannabis Control Division in preparation for legal production and sales of recreational cannabis for adults over 21. The new division will begin accepting and processing license applications no later than Sept. 1, according to a news release from Department of Health.

Existing businesses can continue operating under their Department of Health license until a new license is processed with the division, the news release said. Legal cannabis sales in New Mexico are to begin by April 1, 2022.