A recent case challenged the government transparency as well as the fairness of the Santa Ana-established process for marijuana dispensaries. An entrepreneur named Matt Wagner was coping with a case where he was the underdog who faced a bigger adversary. In other words, he was the David in what OC Weekly described as a ‘David Versus Goliath story’.
In January 2015, Wagner and many other eager businesspeople attended the medical cannabis retail lottery in an Oak Street, Santa Ana property. Wagner entered a waitlist after his medical license bid for his cannabis dispensary turned out to be unsuccessful. It was an annually-updated waitlist, and Wagner had used his entitlement to stay on it at the said Oak Street address through a filed request yearly.
In the year 2017, Santa Ana let another waitlisted applicant who did business under the trademark Purple Holistic, operate where Wagner had long been serving customers. That particular business had earlier become eligible to submit an application for the dispensary’s Regulatory Safety Permit. At that point, things started getting interesting since that was in conflict with the Santa Ana Municipal Code. Under the code, had that business not filed an application on or before August 04, 2017, it would not have been qualified as well as part of the waitlist any longer, thus also ineligible to get an adult marijuana use permit later in the same year.
In November 2017, Santa Ana city changed its order to let permitted medical cannabis dispensaries, plus those entitled to become the dispensary, apply to be the adult-use one too with no merit-based standard. As a waitlisted applicant, Wagner, too, applied for a grown-up use permit while paying all the required fees for a commercial marijuana business for adults at that Oak Street address. The authorities concerned processed Wagner’s Phase 1 cannabis application, and then they invited him to submit another application. Anyhow, he was later denied an appointment for the second application process on the basis of a legal Settlement Agreement between Purple Holistic and Santa Ana.
PotPlus contacted Wagner to know about the latter’s agreement with Chris Francy and Aaron Hertzberg, the men behind Purple Holistic. Wagner told PotPlus that those two first contacted him presumably in 2018 January. They contacted Wagner and tried to buy his waitlist place for around $1 million. That was just a verbal offer made through the phone. Wagner turned down the offer, but he then said that he would consider becoming a Purple Holistic partner for just 20% of that business.
Then, Hertzberg and Francy made one of their lawyers create an offer in writing before sending it to Wagner through email. Wagner kept declining the notion of partnering with the two. Soon after that, Santa Ana granted the duo’s business Wagner’s address. Then, Santa Ana told him that it was not accepting applications at the Oak Street property any longer due to the said settlement agreement. Soon afterward, Wagner’s lawsuit against Santa Ana started.
In October 2018, Santa Ana created its Person Most Knowledgeable (PMK) for giving sworn evidence. PotPlus was informed that the PMK witness did not produce any document, and that Wagner’s lawyer used the plaintiff’s entitlement for more time to take the witness’s deposition. Santa Ana city would only accept continuing the deposition process on November 07, 2018, when the trial was scheduled to happen 13 days later.
What does that mean for Wagner or any other person who attempts to operate as per the local government code? It simply means that Santa Ana was demonstrating its capability of changing the rules concerned for whoever it wanted, with no public process. Still, we wonder why someone who obeyed Santa Ana’s rules, such as Wagner, did not get the chance to compete as per the ordinances that the US city adopted. To know that reason, we would need to discover why the city was being selective regarding who got fair treatment as well as who received settlement agreements, waivers, and shady deals that promised a real unfair advantage.
At the time, OC Weekly reported that PotPlus would keep following the Wagner story as the story continues to develop.