License hunters may have whiplash with state application processes in Kentucky, Minnesota, and Ohio (10(b) licenses) barely in the rearview mirror, but Delaware’s new license application deadline is fast approaching. Applications will be due September 30th. We detailed the requirements for applications in a lengthy post here.
As our national application team starts preparing and submitting applications, there are some keys to take in mind:
One of the instructions that has caused a lot of consternation is that an applicant may be disqualified if “[t]he Application is found to be materially identical to another application.” Some clues about the lottery process can be found in this unique qualification.
First, the Delaware Office of Marijuana Commissioner is signaling that it will actually closely read narratives. While we are used to lottery application rounds where a passing grade on the pass-fail written operational narratives has been a foregone conclusion. But perhaps Delaware will be different. At minimum, the state will be reading each narrative closely to determine if it is “materially identical.” But if we are reading the tea leaves, we expect that narratives should be customized, with careful attention to Delaware-specific regulatory requirements.
Second, the “materially identical,” criterion merits caution in drafting when using outside consulting assistance, but we offer some takeaways:
The same exact corporate entity can use the same or substantially the same narratives for separate dispensary applications in each of the three counties in which it is eligible to apply.
Even in this situation, however, applicants should be mindful to clearly state the applicant’s full corporate name, proposed county of operation, and potential locations (even if aspirational).
Expect the odds in this lottery to be long – at least for “open” applicants as opposed to the microbusiness and social equity applicants. The biggest barrier to entry in any lottery-based application process is site control (i.e., securing a binding interest in property). That is not a requirement here. Even though Delaware is a small state, this is a low-cost, low barrier to entry lottery.
Remember that applicants may submit applications for each and all license types. This differs, for instance, from Kentucky’s recent rules.
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