Broomfield's first three dispensary licensees were picked through a lottery selection last week, but now the city is facing a lawsuit from an applicant who was rejected from the lottery.
Recreational marijuana sales were approved in Broomfield nearly a year ago, but the dispensary-licensing process stalled after a lawsuit was filed against the City and County of Broomfield alleging an unfair application process. That lawsuit was dropped after Broomfield altered the process, which culminated in a lottery on February 22, when numbered balls were drawn. Of the fourteen applicants, ten were approved for the lottery by a selection committee, and Buena Suerta Company LLC, Magnolia Road and LivWell Enlightened Health were named the winners.
But four days before the lottery, City and County Attorney Nancy Rodgers says that the Star Buds dispensary chain had filed a Rule 106 lawsuit against the city. Typically an appeal against a lower governmental body's decision, a Rule 106 lawsuit often aims to overturn project approvals. Star Buds also filed a motion for a temporary injunction "in an attempt to stop the scheduled lottery" hours before it took place, she adds, but that motion was denied.
Despite the pending lawsuit, Broomfield plans to move forward with the licensing. "Broomfield will defend its process, the Selection Committee's determination, and the issuance of the licenses," Rodgers says. The three winners must now get the approval of the state Marijuana Enforcement Division
The first challenge by a rebuffed candidate came in September, when Boulder-based dispensary chain Terrapin Care Station sued Broomfield
, alleging that separately owned but affiliated entities were unfairly flooding the pool with multiple applications. The lottery drawing was put on hold in October, and in January the Broomfield City Council passed an ordinance restricting affiliated entities from submitting multiple licensing bids.
Star Buds, which hasn't responded to a request for comment, was one of four applicants that didn't qualify for the lottery selection. Founded in Colorado, with seventeen dispensaries throughout the state, Star Buds now owns dispensaries in Maryland, Missouri, Oklahoma, South Dakota and Jamaica, as well.
Broomfield voters approved bringing three recreational pot shops to town in the November 2020
election; two more can be issued after the first year of sales. Of the first three businesses to get a crack at opening stores, two have plenty of experience. Magnolia Road was founded in 2013 as a marijuana dispensary and cultivation in Boulder, and now operates another store in Trinidad. LivWell, one of the largest dispensary chains in Colorado, has 21 stores throughout the state.
Buena Suerte LLC, the third lottery winner, doesn't have a current store connected to registered owner Edward Vazquez, but he does have a license for a cultivation in Pueblo, according to the MED.