Title: Cloudi Mornings, LLC v. City of Broken Arrow
Citation: 2019 OK 75
Docket Number: 
State: Oklahoma
Issuer: Oklahoma Supreme Court
Date: November 19, 2019

Cloudi Mornings, LLC v. City of Broken Arrow Annotate this Case Justia Opinion Summary Plaintiffs-appellees, Cloudi Mornings and Austin Miller (collectively Cloudi Mornings) filed a Petition for Declaratory Judgment and Injunctive Relief with the District Court of Tulsa County. In the petition, Cloudi Mornings stated that it was an L.L.C. with its primary business activities located within the City of Broken Arrow and that Austin Miller was a resident of Broken Arrow, and that as a "business within city limits," they had a vested interest in City enacted medical marijuana rules related to the voter approved June 26, 2018, Initiative Petition 788 which legalized medical marijuana in the State of Oklahoma. The Oklahoma Supreme Court retained this case to address the authority of a city, such as the City of Broken Arrow, to zone/regulate a medical marijuana establishment within city limits. However, because this case lacked any case or controversy as to these plaintiffs, and was merely a request for an advisory opinion, the Court dismissed the appeal. Read more Want to stay in the know about new opinions from the Oklahoma Supreme Court? Sign up for free summaries delivered directly to your inbox. Learn More › You already receive new opinion summaries from Oklahoma Supreme Court. Did you know we offer summary newsletters for even more practice areas and jurisdictions? Explore them here . CLOUDI MORNINGS, LLC. v. CITY OF BROKEN ARROW 2019 OK 75 Case Number: 117500 Decided: 11/19/2019 THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. CLOUDI MORNINGS, LLC., and AUSTIN MILLER, individually, Plaintiffs/Appellees, v. THE CITY OF BROKEN ARROW, Defendant/Appellant. APPEAL FROM THE TULSA COUNTY DISTRICT COURT Honorable Patrick Pickerill, Trial Judge ¶0 The voters of the State of Oklahoma passed State Question 788, codified at 63 O.S. Supp. 2018 §420A et seq., on June 26, 2018, legalizing medical marijuana. Subsequently, the City of Broken Arrow enacted local zoning ordinances No. 3540 and 3542 in an attempt to incorporate the introduction of medical marijuana businesses into their community. On September 25, 2018, the plaintiffs/appellees, filed a Petition for Declaratory Judgment and Injunctive Relief in the Tulsa County District Court asking the court to make a legal determination that the City of Broken Arrow had no authority whatsoever to zone or otherwise regulate medical marijuana businesses within city limits. The trial court agreed with the plaintiffs, and on October 17, 2018, issued a declaratory judgment finding, as a matter of law, that Oklahoma cities were precluded from adopting regulations, zoning overlays, fees or other restrictions relating to medical marijuana business activities. The City appealed. The Oklahoma Legislature enacted 63 O.S. Supp. 2019 §425(f), as amended by SB 1030 (effective August 30, 2019) in an apparent attempt to clarify the voter approved enactment and to provide further direction for municipalities to incorporate marijuana businesses within their city limits. On June 24, 2019, we remanded the cause back to the Tulsa County District Court to enter Findings of Fact and Conclusions of Law specifically addressing: 1) whether Broken Arrow, though enactment of it ordinances, has "unduly change[d] or restrict[ed] zoning laws so as to prevent the opening of a retail marijuana establishment; and 2) the impact of the statutory amendment on the validity of the City ordinances. On October 18, 2019, the trial court entered an order answering our questions and making express findings of fact and conclusions of law. We now dismiss the appeal for lack of case or controversy. APPEAL DISMISSED. Trevor A. Dennis, Acting City Attorney, City of Broken Arrow, Charles S. Plumb, Michael F. Smith, Jacob S. Crawford, Tulsa, Oklahoma, Attorneys for Appellant. John E. Rooney, Jr., Ronald E. Durbin, Tulsa, Oklahoma, Attorney for Plaintiffs/Appellees. KAUGER, J.: ¶1 We retained this cause to address the authority of a city, such as the City of Broken Arrow, to zone/regulate a medical marijuana establishment within city limits. However, because the cause lacks any case or controversy as to these plaintiffs, and is merely a request for an advisory opinion, we must dismiss the appeal.1 FACTS/PROCEDURAL POSTURE ¶2 On September 25, 2018, the plaintiffs/appellees, Cloudi Mornings and Austin Miller (collectively Cloudi Mornings) filed a Petition for Declaratory Judgment and Injunctive Relief in the District Court of Tulsa County. In the petition, Cloudi Mornings stated that it is an L.L.C. with its primary business activities located within the City of Broken Arrow and that Austin Miller was a resident of Broken Arrow. ¶3 They contend that as a "business within city limits," they have a vested interest in City enacted medical marijuana rules related to the voter approved June 26, 2018, Initiative Petition 788 which legalized medical marijuana in the State of Oklahoma. The Initiative Petition became codified as 63 O.S. Supp. 2018 §§420 et seq. (The Act).2 ¶4 The original codification governed the legal possession of medical marijuana, caregiver licenses, dispensary licenses,3 licensed commercial growers/packagers,4 processing licenses,5 transportation licenses;6 and directed the establishment of a regulatory office under the Oklahoma State Department of Health (Health Department).7 It also expressly allowed counties and cities to enact medical marijuana guidelines allowing license holders to exceed the state limits regarding legal possession.8 ¶5 The Act included a provision on discrimination towards license holders9 and and stated that "no city or local municipality may unduly change or restrict zoning laws to prevent the opening of a retail marijuana establishment."10 It did not define "retail marijuana establishment." Cloudi Mornings argued that the statutes restricted cities from imposing regulations of activities authorized under the Act and that only the Health Department was entitled to impose any regulations. ¶6 The Health Department created regulations to govern activities under the Act. The regulations are found in the Oklahoma Administrative Code, Title 310, Oklahoma State Department of Health, Ch. 681 and were adopted August 1, 2018, and made effective on August 25, 2018.11 The rules generally cover the application processes of the various licenses, renewals, inspections, inventory, audits, taxes, commercial facilities, packaging, and labeling. Nothing in the rules addressed zoning or location of establishments, but the rules did require premises to meet state and local electrical, fire, plumbing, waste and building codes. ¶7 According to Cloudi Mornings, the City of Broken Arrow met on September 18, 2018, and adopted Ordinance 3540 and 3542, as well as an Amended City of Broken Arrow Manual of Fees.12 The ordinances purport to zone and restrict marijuana operations within the City, much like any other retail establishment. They address parking, building codes, require City permits and application fees, etc. ¶8 Cloudi Mornings did not assert that it was denied any permits, required to pay a particular fee or was prohibited from locating in a chosen location within the City limits in their Petition. Nor do they allege that the ordinances conflict with Health Department regulations and rules. They did attach to the Petition, an affidavit of plaintiff, Austin Miller, who identifies himself as the Manager of Cloudi Mornings. He states that: the company intends to conduct business in the City of Broken Arrow; the ordinances and fees completely frustrate their commercial purposes; and the ordinances will cause substantial and irreparable harm to the company and other individual residents of Broken Arrow. ¶9 Cloudi Morning argues that the City exceeded its authority by addressing any of these regulation issues all together, and they sought to have the City's efforts declared null and void. They also filed an application for emergency temporary restraining order and temporary injunction along with their Petition for Declaratory Judgment. On September 28, 2018, the City objected. It argued that Oklahoma Legislature expressly acknowledged that Cities would need zoning and regulations regarding a new industry which was once illegal, and that the Legislature included the express allowance for municipalities to enact reasonable, common sense ordinances.13 ¶10 The trial court held a hearing on September 28, 2018. At the hearing, Cloudi Mornings argued that after medical marijuana became legal in the State of Oklahoma, they applied for their license, received it, engaged in business. Subsequently, however, the City of Broken Arrow created zoning which, if applied, would mean that Cloudi Mornings is engaged in growing in an area not properly zoned, and not in compliance with City's rules. They offered no measure of monetary damages they may have suffered, but noted that they already had plants growing and had already signed a lease. ¶11 On October 17, 2018, the trial court filed a Final Declaratory Judgment. It held that Oklahoma cities, as a matter of law, were precluded from adopting regulations, zoning overlays, fees or other restrictions to medical marijuana business activities authorized by the Act. Consequently, the City's enactment of the ordinances was not permissible and it enjoined the City from enforcing them. The City appealed and filed a motion to retain on October 31, 2018. We retained the cause on November 15, 2018, and the briefing cycle was completed on May 15, 2019, with the filing of the City's reply brief. ¶12 In the meantime, the Legislature, in the 2019 Legislative session amended portions of the Act. It enacted a new 63 O.S. Supp. 2019 §427 concerning licensure revocations. It also amended §§420 and 425 with multiple amendments. The amendments to §420 relate to record keeping and are not applicable to this cause.14 The amendments to 63 O.S. Supp. 2019 §425 however are pertinent. The Legislature added to the subsection which originally stated that "[n]o city or local municipality may unduly change or restrict zoning laws to prevent the opening of a retail marijuana establishment." The addition states: 2. For purposes of this subsection, an undue change or restriction of municipal zoning laws means an act which entirely prevents retail marijuana establishments from operating within municipal boundaries as a matter of law. Municipalities may follow their standard planning and zoning procedures to determine if certain zones or districts would be appropriate for locating marijuana-licensed premises, medical marijuana businesses or any other premises where marijuana or its by-products are cultivated, grown, processed, stored or manufactured. 3. For purpose of this section, "retail marijuana establishment" means an entity licensed by the State Department of Health as a medical marijuana dispensary. Retail marijuana establishment does not include those other entities licensed by the Department as marijuana-licensed premises, medical marijuana businesses or other facilities where marijuana or any product containing marijuana or its by-products are cultivated, grown, processed, stored or manufactured. ¶13 Because of the legislative amendments, on June 24, 2019, we remanded the cause and ordered the trial court to enter findings of fact and conclusions of law addressing: 1) whether the ordinances had unduly changed or restricted zoning law so as to prevent the opening of a retail marijuana establishment and 2) the impact of 63 O.S. Supp. 2018 §42(f) on the ordinances. We directed the parties to supplement the appellate record with the court's findings within 90 days. ¶14 On October 18, 2019, the trial court filed its Findings of Fact and Conclusions of Law.15 Regarding the facts, it found that: 1) Miller and Cloudi Mornings were actively engaged in the cannabis growing business within the municipality of the City of Broken Arrow; 2) the City ordinances zoned only "Retail Sales businesses," [a/k/a retail marijuana establishments or retail sales establishments], within the City, and such businesses were the only marijuana businesses required by the ordinances to submit an operational and business plan and apply for a City permit and licensing fee; 3) multiple establishments were currently and actively operating dispensaries within City limits; and 4) the Legislature added a subsection to 63 O.S. Supp. 2018 §425(f) which excluded locations where marijuana was grown from the definition of "retail marijuana establishment." ¶15 Regarding conclusions of law, the trial court determined that: 1) the plaintiff/appellees were engaged in an active cannabis growing business within the municipality of the City of Broken Arrow; 2) there is no specific statutory protection against undue changes or restrictions in municipal zoning as provided to a business engaged in the growing or processing of cannabis; 3) the ordinances did not unduly change or restrict zoning so as to prevent the opening of retail marijuana establishments; and 4) the statutory amendments operate as a subsequent clarification of the phrase "unduly change or restrict zoning laws' and defining the term "retail marijuana establishment." APPEAL DISMISSED. ¶16 The City argues that: 1) cities possess the full power of local government and may enact ordinance to protect the public peace, order, health and safety; and 2) reasonable regulations to medical marijuana businesses operating within their jurisdiction fall squarely within the City's purview of authorized regulation. Cloudi Mornings argues that the Act only tasks the Health Department with regulating the marijuana industry and, consequently, cities are powerless to enact marijuana zoning ordinances. ¶17 Cities generally have the authority to enact zoning and regulatory ordinances.16 The voter-approved version of the Act, acknowledged such authority when it noted that no city or local municipality may unduly change or restrict zoning to prevent the opening of a retail marijuana establishment.17 The acknowledgment being that city zoning and regulation could occur as long as the ordinances enacted were not unduly changed or restricted in such a way that no retail marijuana establishment could open within city limits. ¶18 If there was any doubt as to the City's authority, the 63 O.S. Supp. 2019 §425 legislative amendments expressly state that: 1) an undue change or restriction of municipal zoning laws means an act which entirely prevents retail marijuana establishments from operating within municipal boundaries as a matter of law; 2) a "retail marijuana establishment" means an entity licensed by the State Department of Health as a medical marijuana dispensary but does not include other entities licensed by the Department as marijuana-licensed premises, medical marijuana businesses or other facilities where marijuana or any product containing marijuana or its by-products are cultivated, grown, processed, stored or manufactured; and 3) municipalities may follow their standard planning and zoning procedures to determine if certain zones or districts would be appropriate for locating marijuana-licensed premises, medical marijuana businesses or any other premises where marijuana or its by-products are cultivated, grown, processed, stored or manufactured.18 It is well settled that subsequent amendments to an act can be used to ascertain the meaning of the prior statute.19 Where the meaning of a prior statute is subject to serious doubt and has not been judicially determined, a presumption arises that a subsequent amendment was meant to clarify, as opposed to change, the prior statute.20 A subsequent statute clarifying a prior statute can be used to determine the meaning of the prior statute even if the interpretation affects alleged vested rights.21 ¶19 Clearly, the Act authorizes the City to follow standard planning and zoning procedures as to marijuana growers such as Cloudi Mornings. The Act does not even apply the "unduly change or restrict" standard to growers such as Cloudi Mornings. This is a problem for Cloudi Mornings where it was not denied any city permits, required to pay a particular city fee, or prohibited from locating in a chosen location within City limits all together. Nor is there is any indication that the City's ordinances directly conflict with the Health Department regulations and rules. ¶20 At the trial court hearing of September 28, 2018, Cloudi Mornings admitted that if the City's zoning applied, then they would not be in compliance with the City's rules. They also insisted that City's ordinances and fees "completely frustrate their commercial purposes" and that ordinances will "cause substantial and irreparable financial harm to the company" and other Broken Arrow residents. Nevertheless, it appears the City was acting within its authority under the original enactment as approved by the voters. If the original enactment were unclear, the subsequent amendments certainly clarified the issue. ¶21 In short, there is no longer a case or controversy from which the trial court or this Court could declare any relief as to these particular plaintiffs. The rule does not change when a declaratory judgment is involved.22 We do not issue advisory opinions.23 We recognize that there are exceptions for matters which are of great public importance. While this may have been a matter of great public importance when it was enacted by the voters, the Legislature's subsequent action expressly authorizes City zoning. Here, without any indication that City's ordinances have exceeded what the Legislature authorized by the Act and its subsequent amendments, there is nothing for us to decide.24 Furthermore, in so far as this cause is concerned, there is no indication that the City has enforced the zoning ordinances against Cloudi Mornings. Nor is there indication that Cloudi Mornings has sought and been denied a variance.25 Accordingly, we dismiss the appeal. CONCLUSION ¶22 The root of this cause is timing. The voters approved State Question 788 and the City of Broken Arrow responded with ordinances before the Oklahoma Legislature could expand and clarify the legislation. In the meantime, Cloudi Mornings sought and obtained a license to legally grow medical marijuana. It set up shop before the City of Broken Arrow could implement State Question 788, and when it tried to implement it, Cloudi Mornings attempted to thwart the City's efforts with a declaratory judgment. ¶23 However, the Legislature did clarify the legislation with amendments and Cloudi Mornings declaratory judgment arguments were essentially nullified by the Legislative amendments. Because the declaratory relief Cloudi Mornings sought is no longer an issue, Cloudi Mornings has yet to appeared to suffer any loss, and it appears the City was acting within its authority under both the original enactment and its amendments, we must dismiss the appeal. APPEAL DISMISSED. GURICH, C.J., DARBY, V.C.J., KAUGER, WINCHESTER, EDMONDSON, COLBERT, COMBS, KANE, JJ., concur. FOOT