State District Judge David K. Thomson of Santa Fe found the three-and-half-foot seedling owned by the New Mexico Top Organics Ultra Health had no legal permission to leave the firm’s secure production facility in Bernalillo to be part of an “educational” event at the Albuquerque fairgrounds Sept. 8, 2016.
Despite that “flagrant” violation of medical marijuana producer rules in New Mexico, the state Department of Health went too far to penalize the company, Thomson ruled.
He found the proposed five-day suspension of Ultra Health’s medical cannabis sales and distributions was “arbitrary, capricious and lacks foundation” under New Mexico rules. The ban would effectively fine the company $100,000 to $150,000,” he wrote. Thomson found “scant support” for such a punitive fine, which would amount to 1,000 times that allowed under state rules for a first offense.
“The Department is right to want to ensure that cannabis is treated as a medicine under the Act and not a road show prop,” Thomson ruled. “That said, accepting the Department’s finding, the seedling was in a secure box for a period of 7 hours only before they left the State Fair.” There was nothing to show the seedling was distributed or sold or that usable cannabis was involved, he stated in a 19-page ruling.
“The Court assumes other licensees have a better sense than to take their product on the road to the State Fair,” Thomson added.
Ultra Health applied for and was awarded a display space at the fair in September 2016, but “Dorothy” was ordered off the premises the first day of her planned weeklong debut.
In reversing the DOH penalty, Thomson reduced the punishment to two days and allowed Ultra Health to close half days or two full days sometime over the next eight weeks.
The DOH originally imposed the five-day punishment based on strict state production rules, claiming it wasn’t notified in advance about “Dorothy’s” trip to the fair. Nor was there a “travel manifest” created to keep track of the seedling, the judge stated in his ruling.
Ultra Health contended the production process hadn’t begun yet because the plant, since harvested, wasn’t flowering back in 2016. But the judge agreed with the DOH that the rule applied to the “act or process of producing.”
Duke Rodriguez, owner of Ultra Health, told the Journal on Monday that he believed the judge’s ruling was a “reasonable outcome” although “we’d prefer not to have any suspension.”
Rodriguez said, however, the DOH has informed his firm that it plans to appeal the judge’s ruling. A DOH spokesman said Monday that the agency doesn’t comment on pending litigation.
Ultra Health is one of 35 licensed medical marijuana producers in New Mexico. As of May, the highly regulated state program reported nearly 51,000 active medical marijuana patients. Ultra Health is the only dispensary in rural parts of the state, and it serves about 300 patients, the judge’s ruling stated. But Rodriguez said over the course of the legal battle, the company has grown from five dispensaries statewide to 10.
Rodriguez said his firm plans to close Sunday, as per the judge’s order, and take the day to perform community service. Employees are slated to clean along the roadside of Interstate 40 west, and the firm will close another day in July.