Attorneys seek dismissal of marijuana dispensary lawsuit

Judge to rule on breach of contract claim
July 17, 2014
A motion to dismiss a lawsuit filed by Judson Bennett against Mark Lally now waits for a judge's ruling. Bennett's lawsuit claims Lally broke his contract when he went to work for another company looking to get the state's first marijuana dispensary contract. SOURCE FILE

Contract negotiations to establish the state's first marijuana dispensary appear to have hit a snag because of a lawsuit filed by former Lewes Councilman Judson A. Bennett.

Bennett filed a 27-page lawsuit June 17 against former state trooper and lobbyist Mark Lally, saying Lally breached a contract by working for another group seeking the state contract that would allow them to operate the dispensary.

Lally quickly filed a motion to dismiss and attorneys for the two parties met in the Court of Chancery in Dover court June 30. Court of Chancery Vice Chancellor John Noble has yet to issue a ruling.

Bennett said he doesn't believe Lally met the standard for having the case dismissed.

“If it does get dismissed, I'd be shocked,” said Bennett.

On July 1, Lally said his attorneys have advised him to not make any comments on the case.

Bennett said a ruling in his favor would let the real fun begin – when attorneys depose witnesses and review documents.

Bennett's lawsuit claims that he and his partner, Florida-based attorney Jeff Siskind, entered into an agreement with Lally in October 2011, paying him $25,000 for his services. The lawsuit then claims the men entered into another agreement in January 2013,  a month after Gov. Jack Markell suspended the program. This agreement called for Lally to be paid $1,000 a month for six months or until a license was obtained.

First State Compassion Center is also named in the lawsuit. It was formed in January by Jon Levine, a partner of Massachusetts-based Sigal Consulting LLC. The firm specializes in licensing and developing medical marijuana facilities. Lally, a former Sussex County representative for Sen. Tom Carper, is the acting president of First State Compassion.

Despite the lawsuit, the Division of Public Health for Delaware Health and Social Services continues to negotiate a contract with First State Compassion to operate the state's first medical marijuana dispensary.

In a May 16 letter to Lally, sent to the Cape Gazette by Bennett, DHSS said they wanted to begin contract negotiations as soon as possible with First State Compassion. The letter tells Lally it is important that First State Compassion remain silent on the status of the contract until it is signed.

“The premature release of RFP status could result in inadvertent delays,” reads the letter.

Jill Fredel, DHSS director of communications, said negotiations on the contract for the compassion care center are ongoing and all relevant issues will be considered.

“No license will be issued by DHSS’ Division of Public Health until a contract is signed,” said Fredel in an email July 1. “The State’s priority is to have a safe and secure compassion center open as soon as possible.”

Markell representative Kelly Bachman said the governor had no comment on the lawsuit. She said the successful bidder cannot be made public until negotiations are finished and the contract signed.

“DHSS is still in negotiations with the bidder and, therefore, we do not have any further comment at this time,” said Bachman in an email July 2.

The judge gave no time frame for when a ruling on the matter would be delivered.