Lawyer: 'New evidence' shows Aurora botched 2014 marijuana license lottery

Posted at 4:17 PM, Apr 17, 2017
and last updated 2017-04-17 18:17:21-04

AURORA, Colo. – A Denver-area marijuana company says it has new evidence the city of Aurora and the city’s marijuana enforcement division didn’t give it fair treatment when it tried to get one of the city’s marijuana licenses in August 2014.

The suit by Visaj Unity, LLC, which operates as Metro Cannabis, was first filed in late 2014 after the company was denied one of the Aurora Ward 2 licenses to operate a cannabis shop. Metro Cannabis now operates at least three other dispensaries in the Denver area, which operate under the name Silver Stem Fine Cannabis.

At the time, Aurora was using a lottery process to determine which bids would get the four shops in the ward.

The lawsuit has maintained that Metro Cannabis had actually tied with another applicant, Mountain States Group I LLC (MSG), but that the city’s code and the Aurora Marijuana Enforcement Division (AMED) wouldn’t allow for a tiebreaker despite the tie.

And Metro Cannabis maintains in a new filing that it has proof that AMED created the tie in the first place by rounding up the other company’s score, which accounted for various proposals made by each company as to how they would operate their shop should they be granted a license.

That new evidence, attorney Bob Hoban claims, shows that one of three reviewers who was tasked with deciding businesses’ scores in the lottery was actually an Aurora employee and thus not an “independent reviewer.” Hoban claims that the Aurora employee’s involvement in the process means Metro Cannabis did not receive due process in its application being evaluated.

Hoban also says that the city of Aurora has admitted it made a mistake in rounding up MSG’s score, and that it has “steadfastly refused to correct its error.”

“It is not plausible to believe that each of these…data entry errors randomly happened to be outcome-determinative in the absence of any intentional manipulation of scores by the AMED,” Hoban wrote in his latest court filing.

He also claims that AMED showed bias toward the owners of Metro Cannabis, whom were investigated in 2009 by Greenwood Village police for possible discrepancies involving a medical caregiver operation, despite no charges ever being filed.

“It appears that the AMED decided that Visaj should not be granted a license even though the AMED’s rules did not allow the AMED to take away points or otherwise deny an application based on criminal charges that were dropped by the prosecuting agency,” the filing says.

It also says that instead of hiring an independent attorney to act as a hearing officer in license appeals, the city instead hired Jason Batchelor, who oversees AMED, to be the hearing officer in Metro Cannabis’s case.

“Aurora’s reticence to provide pertinent information before, during and after the Oct. 13, 2014 administrative hearing demonstrates a calculated effort to deny Visaj a meaningful opportunity to challenge denial of the license,” Hoban wrote.

And still, Hoban argues, the city is breaking its own rules that put a two-year limit on how long a license winner can sit on a license before it has to start building its new facility. The filing says 3LP, one of the companies that received a license at the time, still has not broken ground on the facility it proposed back then.

The filing claims that Aurora city code has no remedies to allay the problem, and claims violations of the Colorado Constitution in that the company was depraved of its due process.

“The city of Aurora admits it made a mistake, but because the Aurora code doesn’t say what to do in cases of such mistakes, they don’t have to fix it,” co-owner Stan Zislis said.

A jury trial in the case is set for next Monday, April 24 in Adams County District Court. A spokesperson for the city of Aurora says the city does not comment on pending litigation.

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