LOUISVILLE, Ky. — Three Louisville-based cannabis companies filed a lawsuit in Jefferson County Circuit Court challenging Kentucky’s medical cannabis licensing process, claiming the program’s roll-out violated constitutional principles of separation of powers.

The legal action targets the Office of Medical Cannabis and questions whether the agency overstepped its authority in establishing the licensing procedures. 

Attorney Greg Troutman, representing Kentucky Dispensary Partners LLC, Shepherdsville Dispensary Partners LLC, and Metro Processing Partners LLC — all of which failed to win licenses — argues the process was fundamentally flawed.

“The legislature should have decided how to carve the state up and how many licenses would be allocated in each region,” Troutman said, contending that the Office of Medical Cannabis unconstitutionally took control of decisions that should have remained with the General Assembly. “The agency took the reigns because the legislature let them take the reins.”

Defense attorney Aaron Silletto for the Commonwealth of Kentucky countered that “the General Assembly can delegate some of its legislative power to the executive branch,” citing Kentucky Supreme Court precedent.

“The plaintiffs’ issue is not with the statute at all. Their issue is with the Cabinet’s regulations establishing the procedures at play,” Silletto said. The defense is seeking dismissal of the case.

Kentucky’s medical cannabis program began after Gov. Andy Beshear signed Senate Bill 47 into law in 2023. 

The Office of Medical Cannabis started accepting applications in mid-2024, receiving over 4,000 dispensary applications. In December 2024, only 48 winners were selected through a lottery conducted by the Kentucky Lottery Company.

The plaintiffs raise multiple constitutional concerns in their lawsuit. They argue the executive branch improperly assumed legislative powers by determining regional allocation rules without adequate standards or guidance from lawmakers. 

Additionally, they question whether state law authorizes the Kentucky Lottery Company to conduct anything beyond gaming lotteries.

“All the public was able to see is a computer screen that populated with numbers. They can’t see inside the computer,” Troutman said, questioning the transparency of the digital selection process compared to traditional lottery methods.

Despite approximately 15,000 medical cannabis cardholders in Kentucky, no dispensaries have opened statewide, though one facility in Ohio County has received approval.