Louisville, KY — A group of Jefferson County-based medical cannabis companies has filed a lawsuit against the state of Kentucky and former Office of Medical Cannabis (OMC) Executive Director Sam Flynn, alleging that the state’s licensing rollout is unconstitutional, the Courier-Journal reports.
The lawsuit, filed by investors who were denied licenses during the 2024 lottery, challenges the Kentucky General Assembly’s delegation of authority to the Cabinet for Health and Family Services. The plaintiffs argue that only the legislature—not an appointed agency—has the constitutional right to determine how licensing districts are created and how licenses are allocated within them.
“We’re taking issue with the way the legislature failed to be the ones who decided how the state would be carved up for licensing purposes,” said attorney James Gregory Troutman, who represents the plaintiffs.
According to Troutman, if the lawsuit succeeds, state lawmakers would be required to return to the Capitol next session to amend or expand the 2023 medical cannabis law and define a new structure for licensing regions and distribution.
In response, OMC spokesperson Kendra Steele defended the program’s rollout. “The general assembly gave the agency the duty to create a fair licensing structure in 2023,” she said, describing the process as “completely open, transparent and viewable to the public.”
The plaintiffs are requesting that the court halt operations of all currently licensed businesses and issue licenses to the suing parties instead.
The lawsuit could significantly delay the medical cannabis program’s implementation if the court grants a temporary pause or rules in favor of the plaintiffs, potentially reshaping the state’s entire regulatory approach.
