JG City L.L.C. v. State Pharmacy Bd.
2021 Ohio 4624
Ohio Ct. App.2021Background
- Ohio enacted H.B. 523 (2016) creating the Medical Marijuana Control Program; the Ohio Board of Pharmacy (Board) issued RFAs for up to 60 retail dispensary licenses divided into districts.
- JG City applied for a Toledo dispensary in the Northwest-3 district; only two licenses were available and JG City placed third by score.
- The RFA described a "standard 0–10 scoring framework" and included a table illustrating criteria for even-number scores; evaluators in practice used any whole number 0–10 (including odd numbers).
- JG City challenged the scoring process at an administrative hearing; the Hearing Examiner and then the Board denied relief.
- The Franklin County Court of Common Pleas affirmed; JG City appealed, raising (1) noncompliance with the RFA/scoring rules and lack of reliable evidence, and (2) a constitutional challenge to the EDG license set‑aside statute.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did the Board violate its RFA by allowing odd-number scores not shown in the RFA table? | The RFA limited evaluators to the even-number criteria listed; allowing odd numbers violated the RFA. | The RFA used a 0–10 framework illustrated (not limited) by the table; odd numbers were permitted and consistent with best practices. | The court held the table was illustrative and the Board substantially complied with the RFA; odd-number scores were permissible. |
| Was the Board's denial supported by reliable, probative, substantial evidence (i.e., could evaluators reliably distinguish a 1.6% score difference)? | The 1.6% margin was too small to be reliably discerned by subjective graders using an ad hoc 11-point scale. | Scoring narrative responses necessarily involves subjective judgment; no discrete question scores were shown to be incorrect. | The court affirmed that the administrative record contained reliable evidence and the common pleas court did not abuse its discretion. |
| Must JG City show prejudice from the Board's alleged deviation from the RFA? | The Board erred regardless of prejudice; the court should not require a prejudice showing. | Plaintiff must show prejudice; here JG City failed to show it changed the outcome. | Moot: because the court found substantial compliance and reliable evidence, prejudice analysis was unnecessary. |
| Does JG City have standing / was the EDG set‑aside statute unconstitutional as applied or facially? | The EDG preference caused cascading displacements that denied JG City a license, so it suffers direct injury and the statute is unconstitutional. | JG City waived any as-applied challenge administratively and record shows denials were due to license‑limit rules, not EDG displacements; no standing. | The court held JG City lacked standing to show the EDG rule caused its denial and waived an as-applied challenge; statutory provision not shown unconstitutional here. |
Key Cases Cited
- Danis Clarkco Landfill Co. v. Clark Cty. Solid Waste Mgmt. Dist., 73 Ohio St.3d 590 (1995) (public entity must comply with conditions it sets in an RFP; substantial compliance can be sufficient)
- Our Place, Inc. v. Ohio Liquor Control Comm., 63 Ohio St.3d 570 (1992) (definition of reliable, probative, substantial evidence standard)
- Univ. of Cincinnati v. Conrad, 63 Ohio St.2d 108 (1980) (administrative appeal standards)
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (1983) (definition of abuse of discretion)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (standing requires injury, causation, redressability)
- Cuyahoga Cty. Bd. of Commrs. v. State, 112 Ohio St.3d 59 (2006) (standing to attack constitutionality requires direct concrete injury)