EagleHerald Staff Writer

MENOMINEE—With the City of Menominee apparently reluctant to provide more information about how it awarded marijuana retail licenses last year, an attorney for retailer Attitude Wellness/Lume is asking 41st Circuit Court Judge Mary Brouillette Barglind to compel the release of information contained in competitor First Property Holdings/Rize’s application.

Rize—one of two companies awarded adult-use recreational marijuana licenses in September—is digging in its heels and refusing to provide information about its owners in an apparent attempt to slow down the case, while an attorney for Lume said the information is relevant as he seeks to show how the city’s selection process wasn’t competitive but was arbitrary and capricious.

Lume is one of five marijuana companies suing the city in a consolidated case. The other companies are O.I. Holdings/Higher Love, Highwire Farms, NU Group, and Rocky North/Green Pharm.

In the most recent filing, Lume’s attorney Kevin Blair of Honigman LLP said Rize’s application score of 48 points was “overinflated,” and he describes as “suspicious” the circumstances in which Rize received an adult-use recreational retail license. Rize’s score was lower than the perfect scores of 50 Lume received on two retail applications—one for adult-use recreational and one for medical marijuana.

In September, the city awarded Lume a license to open a medical marijuana store but the company didn’t receive an adult-use recreational license. All of the licenses and permits have been put on hold pending the outcome of the lawsuits. The litigation has progressed more slowly than expected because the city hasn’t readily provided information.

Rize said information contained in its previously disclosed applications are “trade secrets” that shouldn’t be disclosed, and it’s accusing Lume of “gamesmanship,” saying its discovery requests are irrelevant to the claims and defenses in the case.

But Lume said it’s the opposite. “All of this is complete nonsense. Rize cannot credibly claim that materials it purposefully filed (twice) on the public docket—and emailed more than once to numerous attorneys representing Rize’s competitors—are trade secrets,” Blair said.

In the business world, trade secrets are information kept confidential because economic value is derived when the information isn’t readily ascertainable.

But Rize’s attorney Mike Cox already disclosed the company’s application in an October filing, which has been reviewed over a six-month period by countless people. What’s more, the information Lume is requesting isn’t particularly sensitive, Blair said.

“These purported issues are nothing but a distraction. Lume has not asked Rize to disclose any purported trade secrets or application materials. It has asked Rize to answer written discovery requests regarding the factual information pertaining to the city’s licensing process.”

Judge Barglind ordered Rize’s Exhibit E sealed on May 4, pending the court’s disposition of Rize’s request to keep the documents confidential, but Blair hopes to persuade Barglind to compel Rize to answer its questions. Blair notes certain sensitive information could be redacted or sealed, while allowing for questions to be answered.

After Rize and The Fire Station Cannabis Co. filed Motions to Intervene in the consolidated case, Barglind asked the two companies receiving adult-use recreational licenses to provide counter-arguments in the case, essentially helping to defend the City of Menominee. But Rize has refused to provide any of the information Lume requested to help move the case along, Blair said.

“Rize hopes to delay as long as possible, so that Lume is hamstrung and cannot use the information it requested to defend its complaint about the city’s selection process,” Blair said.

Lume has raised questions about Rize’s responses on its application related to ownership and certain stakeholders’ experience.

Rize’s failure to respond indicates it is not one of the best-suited applicants to operate in compliance with MRTMA, Lume’s motion said.

“Rize’s gambit here could not be clearer. It hopes to avoid admitting what it must—that it submitted a false application to the city and was not one of the best-suited applicants,” Blair said in the filing.

Lume has raised questions about Rize’s responses on its application related to ownership and certain stakeholders’ experience.

There’s no reason Rize should be allowed to withhold this information, Blair said, citing other previous legal cases in support of his request. In the case of Wood v DAIIE, the judge said, “Delay and evasion are added burdens on litigation, causing waste of judicial and legal time.” They are unfair to litigants “and offend the administration of justice.”

Lume believes other irregularities exist in how Rize’s application was scored, Blair said.

On May 4, Barglind granted Rize’s motion to seal records, but she has allowed interrogatories and requests for admissions to continue. Despite this, Blair said Rize hasn’t answered Lume’s questions.

Rize’s attorney Michael Cox of the Mike Cox Law Firm included the company’s application for a retail license in court documents filed Oct. 15, 2021. When Lume requested information about Rize’s ownership on Oct. 19, the city refused to provide the information. In March, the city said it wouldn’t provide anyone’s application materials outside of a court order.

But Lume said Michigan statute doesn’t provide an evidentiary privilege for the information in the application.