Disqualified Ontario pot shop applicants seek appeal after challenge was dismissed: Lawyers

Lawyers representing 11 people who were disqualified from applying to open a cannabis retail store in Ontario are seeking to appeal after a court dismissed their challenge of the rejection last month.

The group has filed a notice that it is seeking leave to appeal the divisional court decision, saying the three-judge panel erred in finding the Alcohol and Gaming Commission of Ontario acted reasonably in interpreting the licensing rules.

It also argues the case raises issues that go beyond the interests of the specific parties, such as what counts as proper notification.

The group has also filed a motion contesting another judge’s decision not to put the cannabis licensing process on hold until the application for leave to appeal is resolved.

The 11 initially turned to the court in September to challenge their disqualification and dispute the fairness of the procedures involved in the lottery used to grant pot shop licences.

The Alcohol and Gaming Commission of Ontario, which administers the system, had said the applicants were rejected for failing to submit a letter of credit within the established five-day deadline.

But lawyers for the group said the email notifying their clients of the lottery’s outcome bounced back, and the deadline should have been adjusted to account for when they actually received the message.

The divisional court ruled against the group and also lifted a stay on the licensing process for the latest round of pot shops, which it had put in place while the case was underway.

That meant another 11 people who were selected to replace those disqualified could proceed with their applications.

Lawyers for the rejected applicants, meanwhile, filed the notice seeking leave to appeal in the days that followed the ruling. They also sought to have another stay imposed until the matter was concluded.

However, the request for an interim stay was dismissed, with that judge saying he was not satisfied the applicants would suffer irreparable harm without one.

In court documents, lawyers for the group say they will argue the judge erred in finding their clients could sue the AGCO for damages.

They say they will also argue the judge was mistaken when he said the appeal court could require the government to allow the group to apply for licences if that challenge is successful.

“This court has no jurisdiction to compel the government to act in that manner,” the documents say.

The government has held two rounds so far of the lottery that determines who can apply to open cannabis stores.

Lottery winners have five business days to turn in their application, along with a $6,000 non-refundable fee and a $50,000 letter of credit.