The board in all its former, fully-staffed glory.
The board in all its former, fully-staffed glory. WSLCB

A lot of big things happened in the Washington weed world recently. Well, one of them not so recently. Apparently the Washington State Liquor and Cannabis Board (WSLCB) has been operating at 66.6 percent for four months. Board member Russ Hauge resigned at the beginning of March, and the board has been continuing on with just its two remaining members—Jane Rushford and Ruthann Kurose—since then.

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While rumors abound about just why he left, the official word is that he stepped down to pursue other work he was more interested in, according to WSLCB spokesperson Mikhail Carpenter. The resignation was not publicly announced per Hauge's own request, said Carpenter, but the website was changed to reflect his departure. I guess it just took everyone this long to notice. Carpenter added that, until Governor Jay Inslee appoints a third board member, the board will still have a quorum as long as both members vote in agreement. So, essentially, shit can still get done. Regardless, an odd surprise.

State's Patient Database Potentially Breached (But It's Probably Chill)

Yesterday morning, the WSLCB sent out a bulletin alerting, "it has come to the attention of both the Washington State Liquor and Cannabis Board (WSLCB) and the Department of Health (DOH) that some third party commercial traceability software systems are requesting patient information such as: conditions, history, and notes." In other words, that there had been a potential breach of patient confidentiality within a week of the patient database's launch, which is exactly what the DOH spent a year and a half assuring us wouldn't happen.

However, despite the WSLCB's own bulletin making it sound like a crisis, it's not really, Carpenter assured me. Basically, the state-mandated traceability system, BioTrackTHC, also offers its own inventory management software program to help retailers track medical marijuana patients. Some retailers were using it to interface with the new patient database, and it erroneously included fields asking for patient condition, health history, and any notes. Those things are cool to go into the state's patient database, but definitely not into a third-party software system. Apparently, some retailers saw the fields and believed that they needed to be filled out.

A third-party software program used by retailers to track medical marijuana patients erroneously has fields for the patients health information.
A third-party software program used by retailers to track medical marijuana patients erroneously has fields for patient health information.Sweet Relief Cannabis Co.

Likely, none of that data will make it into the wrong hands, but it did potentially end up outside of the patient database to which it was supposed to be strictly confined. The DOH sent out a letter to retailers thanking them for their "bold and adventurous spirit" in jumping "headlong into the transition this past weekend," before attempting to clarify the issue.

"During the roll-out of the database," the letter reads," it came to our attention that some retailers with medical endorsements may have mistakenly believed they could (or must) retain confidential patient information. This is not true." The letter then instructs retailers to delete any patient health information from any software other than the state database, noting that "unauthorized retention or dissemination of patient or designated provider information could result in felony, civil, and/or administrative penalties. It also erodes public confidence in the new medical marijuana market." You said it!

In the WSLCB and DOH's defense, said Carpenter, they have no control over third-party software programs or the actions of retailers, both of which seem to have created the perfect storm here. The DOH did, however, have control over training retailers on how to use the new patient database, and theoretically no one should have been entering patient info that hadn't already completed the medical marijuana consultant (MMC) training course, which requires them to know exactly this shit. One would also think that the state might have tried to see how the patient database interacts with all the various inventory management programs out there before launching, but given that the database came online the night before it was due to launch, it's no surprise they didn't.

Also potentially relevant here: As of July 1, the state had only 147 certified MMCs but 332 medically endorsed stores (which are required to have an MMC on staff at all times). While it's possible for those MMCs to work at multiple stores, is it probable?

While this isn't exactly a catastrophe, it is a vexing oversight, especially given that the state is asking patients to trust them with sensitive medical information in a non-HIPAA=protected database (that's right, HIPAA doesn't apply because the patients are voluntarily releasing their own health info). Patients, already low on trust, did not react well to the latest database flap, disseminating the bulletin on social media with warnings like, "PLEASE DO NOT REGISTER!" Not that the database really does shit for patients, but still, can't we at least make it work?

Here's cannabis attorney and patient privacy advocate Nicole Li's response to the bulletin:

"Patients who brave the recreational atmosphere of retail stores will find a lack of appropriate products and crushingly high prices, as well as insufficient protections for patient privacy and security of patient information. DOH designed a medical marijuana system that makes an end-run around HIPAA, to the peril of patients and the few providers who risk authorizing medical marijuana. The risks of having one's medical information in the authorization database far outweigh any ostensible benefit."

The DOH's Kristi Weeks, chief architect of the database, did not reply to a request for comment, though she did do this short interview with KIRO after the nick-of-time launch of the database. It's...interesting.

Tacoma Collective Gardens Win Major Lawsuit Against WSLCB

If all the database drama wasn't enough, a lawsuit brought against the WSLCB on behalf of Tacoma-area collective gardens scored a major victory last Friday. Thurston County Superior Court Judge Anne Hirsch awarded a summary judgment in favor of the gardens, agreeing that the WSLCB overstepped its authority when making rules to implement SB 5052, unfairly scuttling the gardens' chances of obtaining a retail cannabis license.

The lawsuit, brought by Tacoma cannabis lawyer Jay Berneburg, contended that the state improperly redefined collective gardens, which were given special licensing priority under SB 5052. The state's definition also included retail dispensaries, he said, and his suit argued that dispensaries and collective gardens are very different. His clients, all by-the-book collective gardens, got the short end of the procedural stick, he said. As true collective gardens, they only took enough in donations to cover production expenses and never accepted money in exchange for cannabis. As such, they didn't obtain business licenses or pay sales tax, which retail dispensaries did and which the WSLCB required applicants to provide proof of during the application process.

They got kicked down to priority III because they followed the law," he complained. "I asked the court to invalidate that section of the law [regarding priority licensing] because the LCB has exceeded their authority of the law because they didn’t have the authority to change the definition of a collective garden. The court agreed with me.”

Berneburg said that Senate Bill 5073, passed in the 2011-2012 session, included specific instructions on setting up retail dispensaries and extensive measures to govern them, all of which were vetoed by then Governor Christine Gregoire. Her feeling on the matter, he paraphrased, was that "if you want to be a patient you can grow your own or use a collective garden," contending that collective gardens were meant to be distinct from retail dispensaries. Despite that, retail dispensaries proliferated under the banner of collective gardens, he said.

"I can call myself the Queen of fucking England, too, and that doesn’t make me the Queen of England," he said. "A collective garden isn’t a retail store and it never was."

No court order has been issued yet—that'll happen at some point next week—so what remedy the court decides upon is yet to be seen, but Berneburg says he's asking to see the priority licensing rules struck down and replaced, and for his plaintiffs to be given a second shot at getting a license. Or, as he bluntly put it: “You’re going to write a new rule that works, if you don’t, we’re going to continue to fuck with you until you do.”

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Because the state's retail licenses are currently capped, that would require Hirsch to order the WSLCB to raise the cap, which Berneburg contends she has the power to do.

They’re going to have to expand the number of licenses that are available, and they have absolute statutory ability to do so," he said, adding this interesting aside: "They could put more in Seattle immediately.” This case represents the first inkling of success amongst the many, many litigants suing to overturn various parts of SB 5052. Asked about the case, Carpenter replied that the WSLCB does not comment on pending legislation. Berneburg, however, had plenty more to say.

"They didn’t think that anybody could beat them," he said. "They thought they could do whatever the hell they wanted to do and it turns out they were wrong. This is the first time they were beat as far as I know.”

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