Attorney asks for disqualification of Arkansas Attorney General’s Office from medical marijuana license lawsuit

Pot licensing suit claims conflicts

FILE - In this Aug. 15, 2019 file photo, marijuana grows at an indoor cannabis farm in Gardena, Calif.

An attorney for a rejected medical marijuana cultivator asked the judge in its lawsuit to disqualify the Arkansas attorney general's office from the case in a motion filed Tuesday.

The motion is the latest filing in a lawsuit between 2600 Holdings, LLC and the Arkansas Department of Finance and Administration, Arkansas Alcoholic Beverage Control and the Arkansas Medical Marijuana Commission after the state awarded its last license to cultivate medical marijuana to River Valley Production, LLC of Fort Smith. 2600 Holdings, which does business as Southern Root Cultivation, claims state regulators wrongly awarded the license to River Valley.

In the motion, attorney Abtin Mehdizadegan, representing Southern Roots, called for the judge to dismiss the Attorney General's Office from defending the Department of Finance and Administration in the case, saying it has a conflict of interest with Doralee Chandler, a former director of the Arkansas Alcoholic Beverage Control Division, now working in the Attorney General's Office.

Chandler served as Alcoholic Beverage Control director for more than four years before resigning in February to take a position as deputy attorney general for state agencies, and has served as "an important and necessary witness" in the lawsuit, according to the motion.

"Former Director Chandler cannot represent the same Defendants with whom she has unwaivable conflicts, and the Attorney General to whom she reports should be disqualified as counsel in this proceeding because these conflicts are imputed," according to the motion.

In October, Pulaski County Circuit Court Judge Herbert Wright denied a request from the Attorney General's Office to be dropped as counsel from the lawsuit.

Southern Roots filed its complaint in 2021, claiming Arkansas Medical Marijuana Commission and the Alcoholic Beverage Control Administration had wrongly passed over them in favor of River Valley Production, which does business as River Valley Relief Cultivation.

In November, Pulaski County Circuit Court Judge Herbert Wright issued a ruling in favor of Southern Roots, saying state medical marijuana regulators ignored their own rules when awarding the license to River Valley. Following the order from Wright, Chandler, then-director of Alcoholic Beverage Control, issued an order revoking River Valley's license.

River Valley appealed the decision to the Arkansas Supreme Court, which ruled River Valley can continue to operate while its case is pending. However, the Medical Marijuana Commission is scheduled to vote on whether to renew River Valley's license at a meeting today. The commission had postponed a vote on the Fort Smith cultivator's license at its last meeting May 18.

The Arkansas Attorney General's Office filed a response to Southern Roots' motion Thursday, saying the request would leave the defendants without proper representation.

"Today I responded to the motion seeking to disqualify the Office of the Attorney General from representing the state agencies sued by 2600 Holdings, LLC," Attorney General Tim Griffin said in a statement Thursday. "Not only does the Pulaski County Circuit Court lack jurisdiction to rule on the motion due to a pending appeal, but the plaintiff’s request is also frivolous. There is no conflict of interest prohibiting the Attorney General from continuing as the defendants’ lawyer. And removing the Attorney General as counsel of record would force the defendants to hire private counsel at taxpayer expense. The motion lacks merit and should be denied.”