Court Opinion

ID: 4537942
Source: CourtListenerOpinion
Date Created: 2020-06-01 07:06:43.777193+00
Date Added: 2024-06-11T12:39:55.207258
License: Public Domain

Cite as 2020 Ark. 213
                  SUPREME COURT OF ARKANSAS
                                       No.   CV-19-739

                                                 Opinion Delivered: May   28, 2020
ARKANSAS DEPARTMENT OF
FINANCE AND ADMINISTRATION;                      APPEAL FROM THE PULASKI
ARKANSAS ALCOHOLIC BEVERAGE                      COUNTY CIRCUIT COURT
CONTROL DIVISION; AND ARKANSAS                   [NO. 60CV-18-8555]
MEDICAL MARIJUANA COMMISSION
                     APPELLANTS                  HONORABLE WENDELL GRIFFEN,
                                                 JUDGE
V.
                                                 AFFIRMED IN PART; REVERSED AND
CARPENTER FARMS MEDICAL                          DISMISSED IN PART; REMANDED.
GROUP, LLC
                      APPELLEE

                            RHONDA K. WOOD, Associate Justice

       The Arkansas Medical Marijuana Commission disqualified Carpenter Farms

Medical Group, LLC’s application for a marijuana-cultivation facility. Carpenter Farms

sued and asserted it was the only 100 percent minority-owned applicant and that the

Commission violated equal protection by singling out its application for disparate

treatment. Carpenter Farms also alleged that the Commission violated the Administrative

Procedure Act by failing to adopt certain rules and improperly applying the rules it did

adopt. The State moved to dismiss based on sovereign immunity, but the circuit court

denied the motion. The State filed this interlocutory appeal.
       We affirm in part; reverse and dismiss in part; and remand. Carpenter Farms can

proceed with its claim that the Commission failed to adopt model rules. It can also

proceed with its declaratory-judgment action alleging an equal-protection violation. But the

lawsuit cannot go forward regarding the Commission’s application of its own rules or as an

administrative appeal.

                         Part I. Procedural Background and Relevant Facts

                                       A. Factual Allegations

       The people of Arkansas legalized medical marijuana by constitutional amendment.

Ark. Const. amend. 98. Amendment 98 established the Arkansas Medical Marijuana

Commission “to determine the qualifications for receiving . . . a license to operate a

cultivation facility.” Id. § 19(a)(1). The Commission consists of five members. Id. § 19(a)(3).

Amendment 98 instructed the Commission to adopt certain rules to “carry out the

purposes of this amendment” and to “perform its duties”; such rules were to be “rules as

defined in the Arkansas Administrative Procedure Act [APA].” Id. § 8(b)(1), (2). The

Commission accordingly adopted governing rules and regulations. See Ark. Admin. Rule

006.28.17-001 (MMC Rules).

       Carpenter Farms sued the Commission, the Arkansas Department of Finance and

Administration (DFA), and the Arkansas Alcoholic Beverage Control Division (ABC)

(collectively, the “State”). The facts as alleged in the complaint are as follows. Carpenter

Farms applied for a medical-marijuana cultivation license. Carpenter Farms contended it

was the only 100 percent minority-owned applicant. After Carpenter Farms submitted its

                                                2
application, ABC staff concluded that Carpenter Farms’ application was “complete and . . .

contain[ed] requisite supporting documentation.”

       A second, substantive review then took place. The Commission sent Carpenter

Farms an email stating that “[t]he application you submitted has now been verified.” ABC

staff sent Carpenter Farms a follow-up email stating that “[o]ur office now considers your

application complete and it will go before the Commission for scoring.” Four of the five

commissioners later returned their scores for all the cultivation-facility applications,

including Carpenter Farms’.

       But before the Commission released scores for all cultivation-licensing applications,

ABC staff member Mary Robin Casteel again reviewed Carpenter Farms’ application. (At

this point, Carpenter Farms alleged it was ranked fifth or higher by the four commissioners

who had submitted their scores, with the five highest-scored applicants receiving licenses.)

Upon this review, Casteel unilaterally disqualified Carpenter Farms and removed it from

the list of scored applicants. The stated reason for the disqualification was a discrepancy in

Carpenter Farms’ ownership structure, which purportedly violated Amendment 98’s

ownership requirements. (Carpenter Farms maintained that this discrepancy was a

scrivener’s error.)

       Casteel communicated her decision to disqualify Carpenter Farms to Travis Story,

the sole commission member whose scores remained outstanding. She also specifically

identified Carpenter Farms as the applicant, thus breaking “confidentiality on the blind

scoring.” Carpenter Farms alleged that Story scored its application last and gave it “the

                                              3
exact score needed to ensure [Carpenter Farms’] aggregate score put it in sixth place instead

of fifth place.”

       After all the commissioners returned their scores, the Commission released the raw

scores publicly and awarded five tentative cultivation-facility licenses. Carpenter Farms was

not among the scored applications––its first notice that its application was disqualified.

Carpenter Farms alleged it was the only applicant with a verified application that did not

receive a public score. It also alleged that its was the only application that was disqualified

after being scored. Carpenter Farms also maintained that its disqualification occurred

without the Commission being notified. Counsel for DFA initially agreed to present

Carpenter Farms’ motion for reinstatement to the Commission. But the Commission later

obtained its own counsel and, upon her advice, denied Carpenter Farms an opportunity to

be heard at two Commission meetings.

       The Commission ratified Carpenter Farms’ disqualification at its July 2018

meeting. Carpenter Farms then submitted a motion for reconsideration and a request for a

hearing. The Commission denied the motion and issued a formal letter to Carpenter

Farms disqualifying its application for a license.

                                       B. Legal Allegations

       Carpenter Farms’ complaint rests mainly on two legal theories: (1) the Commission

violated the APA and MMC Rules and (2) the Commission violated equal protection by

subjecting Carpenter Farms’ application to disparate treatment.

                                               4
       Under its APA legal theory, Carpenter Farms maintained that the Commission

failed to adopt model rules as required by Arkansas Code Annotated section 25-15-215.

Had the Commission adopted the model rules, Carpenter Farms argues, it would have had

an opportunity for notice and a hearing following the disqualification. Carpenter Farms

also asserted that the Commission violated MMC Rules when it refused to score Carpenter

Farms’ verified application.

       Under its disparate-treatment theory, Carpenter Farms alleged that the Commission

and Casteel permitted scoring of other applicants and issued licenses despite their

applications containing similar errors that should have barred their scores under

Amendment 98 or MMC Rules. For example, it maintains that some applicants failed to

submit adequate documentation proving residency; had outstanding tax liabilities in

violation of Commission rules; and would have placed a facility impermissibly close to a

church. Carpenter Farms also maintained that Casteel’s heightened review of its

application was “arbitrary, capricious, biased and lawless,” violated the MMC Rules, and

violated the U.S. and Arkansas Constitutions’ due-process and equal-protection clauses.

       Carpenter Farms requested that the circuit court reinstate its application; allow its

score to stand; declare that its disqualification was ultra vires, arbitrary, capricious, and

contrary to law; declare that the Commission’s failure to adopt model rules was improper;

and reject Story’s score and recalculate Carpenter Farms’ score “to be five times the average

of the other four scores.” If the court denied its request to reinstate its score, Carpenter

Farms asked the court to vacate the disqualification; order a hearing under Arkansas Code

                                             5
Annotated sections 25-15-207 and 25-15-212(B) (Repl. 2014 & Supp. 2019); and disqualify

Casteel and Story from further participation. It also asked for an injunction prohibiting

the granting of additional cultivation licenses.

       The State moved to dismiss based on sovereign immunity. It argued that Carpenter

Farms’ complaint impermissibly sought to control the lawful action of the State. It also

argued that appeals under the APA are limited to agency “adjudications” and no

adjudication had taken place.

       The circuit court held a hearing and denied the motion by written order. The court

found that Carpenter Farms’ complaint contained detailed allegations that the

Commission violated equal protection. The court reasoned that the complaint sufficiently

alleged the “illegal-act” or “ultra vires” exception to sovereign immunity. The State appeals

this order. The State also alleges that the circuit court displayed injudicious conduct at the

hearing and should be barred from considering any case involving the Attorney General.

                      C. Standard of Review and Sovereign Immunity

       In reviewing a circuit court’s decision on a motion to dismiss, “we treat the facts

alleged in the complaint as true and view them in the light most favorable to the plaintiff.”

McGhee v. Ark. State Bd. of Collection Agencies, 360 Ark. 363, 368, 201 S.W.3d 375, 377

(2005). We focus “only to the allegations in the complaint and not to matters outside the

complaint.” Id., 201 S.W.3d at 378. We will resolve all reasonable inferences in the

complaint’s favor and construe the pleadings liberally. Monsanto Co. v. Ark. State Plant Bd.,

2019 Ark. 194, at 8, 576 S.W.3d 8, 13. The State here asserts that sovereign immunity bars

                                               6
Carpenter Farms’ complaint. We review this issue de novo. Ark. Cmty. Corr. v. Barnes, 2018
Ark. 122, at 2, 542 S.W.3d 841, 842.

       The State’s sovereign immunity originates in Article 5, section 20 of the Arkansas

Constitution, which provides “[t]he State of Arkansas shall never be made defendant in

any of her courts.” The sovereign-immunity doctrine bars suit “if a judgment for the

plaintiff will operate to control the action of the State or subject it to liability.” Bd. of

Trustees of Univ. of Ark. v. Andrews, 2018 Ark. 12, at 5, 535 S.W.3d 616, 619. In Andrews, we

held that the General Assembly’s waiver of sovereign immunity in cases involving the

minimum-wage act were “repugnant” to the Arkansas Constitution’s mandate that the

State not be made a defendant in any court. Id. at 10, 535 S.W.3d at 622.

       But when a party appeals from an agency adjudication, the sovereign-immunity

doctrine does not apply. Ark. Oil & Gas Comm’n v. Hurd, 2018 Ark. 397, at 11, 564 S.W.3d
248, 255. In these appeals, the State’s role is that of a “quasi-judicial decision-maker rather

than a real party in interest.” Id. at 10, 564 S.W.3d at 255. Further, in Martin v. Haas, a

post-Andrews case, we reiterated that “our sovereign immunity cases allow actions that are

illegal, unconstitutional or ultra vires to be enjoined.” 2018 Ark. 283, at 7, 556 S.W.3d
509, 514 (cleaned up). Thus, an allegation of “ultra vires” or “illegal” acts by the State

remains an exception to sovereign immunity that even following Andrews is “alive and

well.” See Monsanto, 2019 Ark. 194, at 9, 576 S.W.3d at 13; see also Ark. Game & Fish

Comm’n v. Heslep, 2019 Ark. 226, at 6, 577 S.W.3d 1, 5 (noting exception to sovereign

immunity for state’s illegal acts); Ark. State Plant Bd. v. McCarty, 2019 Ark. 214, at 7, 576

                                              7
S.W.3d 473, 477 (same). Even so, a plaintiff must still comply with our fact-pleading rules

when alleging an exception to sovereign immunity. See Williams v. McCoy, 2018 Ark. 17, at

3, 535 S.W.3d 266, 268.

                       Part II. Administrative Procedure Act (Section 212)

       Section 212 of the APA permits judicial review of agency adjudications. Ark. Code

Ann. § 25-15-212(a). But an adjudication takes place only following “the final

disposition . . . in which the agency is required by law to make its determination after

notice and hearing.” Ark. Code Ann. § 25-15-202(1), (6) (Supp. 2019). Thus, only “quasi-

judicial” agency functions support further judicial review. Tripcony v. Ark. Sch. for the Deaf,

2012 Ark. 188, at 7, 403 S.W.3d 559, 562. These functions will generally include hearing

testimony, making findings of fact, rendering legal conclusions, and recording the

proceedings. See Sikes v. Gen. Publ’g Co., 264 Ark. 1, 7, 568 S.W.2d 33, 36 (1978).

       We addressed a similar challenge to the Commission’s licensing decision in

Arkansas Department of Finance and Administration v. Naturalis Health, LLC, 2018 Ark. 224,

549 S.W.3d 901. There, a failed cultivation-facility applicant sued to enjoin the

Commission; it alleged the Commission’s application process was flawed, biased, and

arbitrary. The circuit court agreed and declared the Commission’s licensing decision void

and enjoined the Commission from issuing further licenses.

       We reversed and dismissed, concluding that the circuit court lacked subject-matter

jurisdiction. We noted that courts lack “jurisdiction to examine administrative decisions of

state agencies.” Id. at 6, 549 S.W.3d at 906. We explained that the courts have limited

                                               8
review under APA section 212 only for quasi-judicial “adjudications”; if there is no agency

adjudication, then there is no action for a court to review. Id. at 7, 549 S.W.3d at 906. We

held that the Commission’s decision to grant cultivation licenses to certain applicants was

not an adjudication and that as a result, the circuit court lacked subject-matter jurisdiction

under section 212. Id. at 7–8, 549 S.W.3d at 906.

       Naturalis controls here to the extent Carpenter Farms’ complaint rests on section

212. Indeed, all agree that the Commission’s decision to disqualify Carpenter Farms took

place without notice or a hearing. Nor did the Commission hear testimony, make factual

findings, or render legal conclusions. The Commission issued a disqualification letter and

never acted quasi-judicially. Indeed, the Commission’s decision to disqualify Carpenter

Farms took place administratively, and no party suggests that the Commission must make

this “determination [disqualification] after notice and hearing,” the statutory definition of

an adjudication.1 We therefore reverse and dismiss Carpenter Farms’ complaint to the

extent it rests on section 212 as a jurisdictional basis.

                       Part III. Administrative Procedure Act (Section 207)

                                     A. Application Challenge

       1
        Notably, the model rules, which Carpenter Farms urges the Commission to adopt,
do not define denials or disqualifications of licenses as adjudications. The comment to the
model rules states that “[h]earings to revoke a license or permit or to impose a civil penalty
are adjudicative hearings” and that “[a]n agency acts in a quasi-judicial capacity when it
conducts an adjudicative hearing.” Model Rules of Procedure for Regulatory and Licensing
Agencies, § (VII), cmt. (2015). The model rules provide for judicial review when a license is
revoked; but the model rules do not provide for review when the agency disqualifies or
denies an application.

                                                9
       Section 207 permits an injured party to bring a declaratory-judgment action

challenging a rule’s “validity or applicability.” Ark. Code Ann. § 25-15-207(a). Carpenter

Farms maintains that the MMC Rules require the Commission to acknowledge its score,

despite the Casteel disqualification. But this is an unauthorized challenge to an agency’s

application of a rule. Naturalis prohibits Carpenter Farms’ complaint to the extent that it

challenges under section 207 the Commission’s application of its own rules.

       We held in Naturalis that an agency’s case-specific “application” of its rules was not

subject to judicial review under section 207. 2018 Ark. 224, at 9, 549 S.W.3d at 907. A

court cannot review “how the rule should be applied given a particular set of facts or

circumstances.” Id. Carpenter Farms here alleges, in part, that the Commission should

have acted differently—that is, scored the application per MMC Rules—given the set of

circumstances surrounding the submission. Naturalis prohibits this type of challenge.

                            B. Applicability or Validity Challenge

       Carpenter Farms makes another allegation absent from Naturalis: the Commission

failed to adopt model rules promulgated by the Attorney General under section 215 of the

APA. Unlike the above challenge to a rule’s application, this is a permissible challenge to

the validity of the MMC Rules. Under section 215, the Attorney General should publish

model rules, and the agency “shall adopt . . . those model rules that are practicable.” Ark.

Code Ann. § 25-15-215(b)(1) (emphasis added). If the agency adopts different rules, it “shall

state the reason why the relevant portions of the model rules are impracticable.” Ark. Code

Ann. § 25-15-215(b)(2) (emphasis added). Carpenter Farms asserts that the Attorney

                                             10
General has indeed promulgated model rules that the Commission both failed to adopt

and failed to explain why that decision was impracticable.

       In Naturalis, this court did not address a challenge involving section 215. And

Carpenter Farms’ claim that the Commission failed to follow a mandatory provision of the

APA is an allegation of ultra vires or illegal action, an exception to sovereign immunity. See

Monsanto, supra; Heslep, supra; and McCarty, supra. Carpenter Farms maintains that the

MMC Rules were invalid because (i) they are not the ones promulgated by the Attorney

General and (ii) the Commission failed to explain why it adopted rules different from the

model. We agree that this particular claim can proceed under section 207 because it

involves the applicability or validity of the Commission’s rules, rather than the

Commission’s application of those rules to Carpenter Farms’ set of circumstances.

       The State challenges this in several ways. First, it argues that Carpenter Farms’

application was “disqualified” not “denied.” This distinction is semantic. From Carpenter

Farms’ perspective, a denial and disqualification are substantively the same thing—

Carpenter Farms cannot obtain a cultivation license. This argument lacks merit.

       Second, the State argues that Carpenter Farms lacks standing and failed to exhaust

its administrative remedies. But these issues are not ripe in an interlocutory appeal

regarding sovereign immunity. Only sovereign immunity is properly before this court

under Arkansas Rule of Appellate Procedure–Civil 2(a)(10). Ark. Dep’t of Human Servs. v.

Fort Smith Sch. Dist., 2015 Ark. 81, at 10, 455 S.W.3d 294, 301; Williams, 2018 Ark. 17, at

5, 535 S.W.3d at 269; (“[W]e do not hear on interlocutory appeal any issue other than

                                             11
whether the circuit court erred . . . on the issue of sovereign immunity.”); see also Ark. St.

Bd. of Ed. v. Magnolia Sch. Dist., 298 Ark. 603, 604, 769 S.W.2d 419, 420 (1989) (holding

party cannot challenge standing in an interlocutory appeal regarding class certification);

Searcy Healthcare Ctr., LLC v. Murphy, 2013 Ark. 463, at 6–7 (holding party cannot

challenge standing in an interlocutory appeal from the denial of a motion to compel

arbitration).

       Finally, the State asserts that the Commission’s rule-making authority pronounced

in Amendment 98 abrogated section 215’s requirement to adopt model rules. But the

Amendment lacks such broad language. It states merely that “the commission . . . shall

adopt rules necessary to . . . [c]arry out the purposes of . . . and perform its duties under

this amendment.” Ark. Const. amend. 98, § 8(b)(1). Indeed, this provision even goes

further and provides that “rules adopted under this section are rules as defined in the

[APA].” Id. § 8(b)(2). If anything, the Commission’s rules should be in concord with the

APA.

       In conclusion, the circuit court lacked subject-matter jurisdiction over Carpenter

Farms’ challenge to the Commission’s application of its own rules pursuant to Naturalis.

But Carpenter Farms’ allegation that the Commission failed to adopt model rules as

required by law, or give a reason for not doing so, can proceed in the face of sovereign

immunity under the “ultra vires” or “illegal acts” exception.

                                   Part IV. MMC Rule 19

                                             12
       Carpenter Farms also asserts that the Commission’s own internal rule established

an independent basis for the circuit court’s subject-matter jurisdiction. We disagree. Under

MMC Rule 19, the Commission provides that if it “denies an application for a cultivation

license, the commission’s decision may be appealed to . . . circuit court.” The Naturalis

court did not review this issue because, there, the Commission had not yet issued denial

letters. Naturalis, 2018 Ark. 224, at 10, 549 S.W.3d at 908. But here, Carpenter Farms

received a disqualification letter. The issue is live, despite the State’s contention that

Carpenter Farms cannot oblige itself of this rule because its application was “disqualified”

rather than “denied.”

       Even so, the Commission’s rule violates our holding in Andrews that the legislature’s

waiver of sovereign immunity in cases involving the minimum-wage act violated the

Arkansas Constitution. 2018 Ark. 12, at 10, 535 S.W.3d at 622. If the legislature cannot

create a waiver by statute, then neither can the executive branch (here, the Commission) by

its own internal rule.

       Indeed, a court obtains subject-matter jurisdiction through the Arkansas

Constitution or by constitutionally authorized statutes or court rules. Edwards v. Edwards,

2009 Ark. 580, at 4, 357 S.W.3d 445, 448. A state agency’s internal rule cannot

independently establish subject-matter jurisdiction in the judicial branch. MMC Rule 19

cannot and does not create an independent basis for the circuit court’s jurisdiction that

does not otherwise exist under the APA. And because MMC Rule 19 would expand

                                            13
judicial review from that authorized under the APA, the lawsuit cannot go forward with

Rule 19 as the jurisdictional hook.

                          Part V. Declaratory Judgment (Equal Protection)

       Carpenter Farms titled its complaint, in part, as one seeking declaratory judgment.

It pled specifically that the Commission violated the Equal Protection Clauses of the U.S.

and the Arkansas Constitutions. Its prayer for relief requests a declaratory judgment that

the Commission’s disqualification was contrary to law. “Pleadings are to be liberally

construed and are sufficient if they advise a defendant of his obligations and allege a

breach of them.” Rabalaias v. Barnett, 284 Ark. 527, 528, 683 S.W.2d 919, 921 (1985).

       The circuit court has subject-matter jurisdiction to determine whether the

Commission violated Carpenter Farms’ constitutional rights in this regard. See Ark. Code

Ann. §§ 16-111-101 et seq. (Repl. 2016). Carpenter Farms may pursue relief under the

declaratory-judgment cause of action against the State. See, e.g., McGhee v. Ark. State Bd. of

Collection Agencies, 375 Ark. 52, 289 S.W.3d 18 (2008) (striking down check-cashers act in

declaratory-judgment action); Dep’t of Human Servs. v. Howard, 367 Ark. 55, 238 S.W.3d 1

(2006) (striking down a DHS regulation in a declaratory-judgment action); Jegley v. Picado,

349 Ark. 600, 80 S.W.3d 332 (2002) (striking down anti-sodomy statute in declaratory-

judgment action).

       As explained above, our sovereign-immunity doctrine allows this claim because it is

premised on the State’s unconstitutional actions. See Martin, 2018 Ark. 283, at 7, 556
S.W.3d at 514. One caveat is that a complaint alleging illegal and unconstitutional acts

                                              14
must comply with our fact-pleading rules. See Williams, 2018 Ark. 17, at 3, 535 S.W.3d at

268. At the interlocutory stage, Carpenter Farms meets this initial threshold. An equal-

protection claim must first show that there is state action that differentiates among

individuals. Ghegan & Ghegan, Inc. v. Barclay, 345 Ark. 514, 521, 49 S.W.3d 652, 656

(2001). Carpenter Farms has at least made a plausible case that there is state action (by the

Commission) that differentiates among individuals (the 100 percent minority-owned

applicants and everyone else).

       Carpenter Farms alleged specific facts absent from other cases in which we have

dismissed at the complaint stage. See Ark. State Claims Comm’n v. Duit Constr. Co., 2014 Ark.
432, 445 S.W.3d 496. There, the plaintiff asserted, without factual support, that the claims

commission recommended higher damages awards to resident contractors than to

nonresident contractors. Id. at 8, 445 S.W.3d at 503. In contrast, Carpenter Farms here

highlighted multiple, similar defects in other applications that did not result in

disqualification.

       Whether this allegation can be proved and the appropriate remedy are questions

left for another day. For now, Carpenter Farms has alleged a plausible equal-protection

violation. Liberally construing the allegations of disparate treatment in its complaint, we

hold that Carpenter Farms may proceed with a declaratory-judgment action that the

Commission violated equal protection.2

       2
         The State argues for the first time in its reply brief that all claims should be
dismissed against DFA and ABC. But a new issue may not be raised for the first time in the

                                             15
                                   Part VI. Reassignment

       The State also argues that if the case can proceed, we should reassign this matter to

a different circuit judge. The State maintains that this judge should be prohibited from all

cases involving the Attorney General’s Office. The State complains that the judge exhibited

injudicious behavior. It highlights specifically what it characterizes as the judge’s

demeaning behavior during a hearing in this case.

       The legal basis for removing the judge, the State argues, rests with Amendment 80.

Amendment 80 establishes this court’s general superintending control over all the courts

of the state. Ark. Const. amend. 80, § 4. “Superintending control is an extraordinary

power that is hampered by no specific rules or means.” Parker v. Crow, 2010 Ark. 371, at 5,

368 S.W.3d 902, 906. “By virtue of the jurisdiction, the court may invent, frame, and

formulate new and additional means, writs, and processes.” Id. (cleaned up). Though we

have the power to do so, we reject the State’s plea to order reassignment because that

remedy is not warranted on this record.

                                    Part VII. Conclusion

       To conclude: we affirm on the limited basis of Carpenter Farms’ section 207

challenge to the validity and applicability of the Commission’s own rules. But any claims

arising from section 212 or MMC Rule 19 are reversed and dismissed. We remand with

appellant’s reply brief. JurisDictionUSA, Inc. v. Loislaw.com, Inc., 357 Ark. 403, 409, 183
S.W.3d 560, 564 (2004). We therefore need not parse our holding among the different
defendants.

                                            16
instructions to permit the complaint to go forward only under section 207 and the

declaratory-judgment action alleging an equal-protection violation.

       Affirmed in part; reversed and dismissed in part; remanded.

       BAKER, HUDSON, HART, WYNNE, and WOMACK, JJ., concur in part; dissent in part.

       KAREN R. BAKER, Justice, concurring in part and dissenting in part. While I

concur in the result reached by the majority in Parts II, III(A), IV, and VI, I dissent from

the remainder of the opinion. Because I cannot agree with the majority’s interpretation of

the precedent established in Board of Trustees of the University of Arkansas v. Andrews, 2018
Ark. 12, 535 S.W.3d 616, I would also reverse and dismiss Part III(B) and Part V for the

reasons explained below.

       This majority is inconsistent with Andrews. As I explained in my dissent in Arkansas

Oil & Gas Comm’n v. Hurd, 2018 Ark. 397, at 1, 564 S.W.3d 248, 249, Andrews does not

provide for exceptions to its broad language barring suit against the State. In Andrews, the

court held that “never means never,” and did not identify exceptions. Accordingly, despite

the majority’s attempt to narrow Andrews, the broad language of Andrews does not permit

such suit. Here, like Hurd, Carpenter Farms alleges that the appellants’ actions were

beyond the appellants’ authority as a state board and acted in an ultra vires manner.

Therefore, state conduct is at issue, and Andrews bars suit.

       Accordingly, I concur in part and dissent in part.

       ROBIN F. WYNNE, Justice, concurring in part and dissenting in part. I join Part III

of the majority opinion allowing Carpenter Farms to challenge the validity and

                                              17
applicability of the Medical Marijuana Commission’s rules under Arkansas Code

Annotated section 25-15-207.      I also join Part VI on the reassignment issue. But I

respectfully dissent from the majority’s holding in Part II because I would hold that the

circuit court has jurisdiction under Arkansas Code Annotated section 25-15-212 to review

the MMC’s denial of Carpenter Farms’ application for a cultivation license.

       Arkansas Code Annotated section 25-15-212 vests circuit courts with jurisdiction to

review agency actions, providing that “[i]n cases of adjudication, any person . . . who

considers himself or herself injured in his or her person, business, or property by final

agency action shall be entitled to judicial review of the action under this subchapter.” Ark.

Code Ann. § 25-15-212(a). “‘Adjudication’ means an agency process for the formulation of

an order.” Ark. Code Ann. § 25-15-202(1)(A). “‘Order’ means the final disposition of an

agency in any matter other than rulemaking, including licensing and rate making, in which

the agency is required by law to make its determination after notice and hearing.” Ark.

Code Ann. § 25-15-202(6).

       In Arkansas Department of Finance & Administration v. Naturalis Health, LLC, 2018
Ark. 224, 549 S.W.3d 90, this court examined whether section 25-15-212 allows judicial

review of MMC licensing decisions. In Naturalis, we explained that judicial review under

the Administrative Procedure Act is limited to agencies’ judicial functions, which are

basically adjudicatory or quasi-judicial in nature. Id. at 6–7, 549 S.W.3d at 906. In the case

of an applicant who did not receive a cultivation license, but was not formally denied one

either, we identified no adjudicatory or quasi-judicial action on the part of the MMC. We

                                             18
concluded that because no adjudication occurred at the agency level, judicial review was

not available under section 25-15-212. Id. at 8, 549 S.W.3d at 906.

       Relying on Naturalis, the majority concludes that the MMC’s decision on Carpenter

Farms’ license application is not an adjudication subject to judicial review. But Naturalis

can be distinguished. The plaintiff in Naturalis had not been denied a license; rather, it

simply had not been granted one. There was no final agency decision to review. In contrast,

the MMC issued a formal letter denying Carpenter Farms’ license application.

       The MMC denied Carpenter Farms’ application without providing notice and a

hearing and now argues that the circuit court cannot review that decision because it did

not provide notice and a hearing. I disagree. An agency cannot evade judicial review of its

licensing decisions simply by adopting rules that do not allow for notice and a hearing. In

my view, the MMC’s decision to deny Carpenter Farms’ application for a cultivation

license is an order subject to judicial review. It is a final determination. It is not legislative,

such as rulemaking, or administrative, such as terminating an employee. I would conclude

that the MMC’s denial of Carpenter Farms’ license application is a final agency decision

subject to judicial review, so sovereign immunity would not bar Carpenter Farms’ action

under section 25-15-212. See Ark. Oil & Gas Comm’n v. Hurd, 2018 Ark. 397, at 11, 564
S.W.3d 248, 255.

       Because I would conclude that the circuit court has jurisdiction under section 25-15-

212, I would decline to consider whether MMC Rule 19 independently confers

jurisdiction. And while I agree with the majority that Carpenter Farms may proceed with

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its equal protection claim, I think judicial review of this claim is available under section 25-

15-212. Therefore, I do not join Parts IV and V of the majority opinion.

       HUDSON and HART, JJ., join.

       SHAWN A. WOMACK, Justice, concurring in part and dissenting in part. I

respectfully disagree with the majority’s conclusion that Carpenter Farms may pursue

declaratory judgment for MMC’s alleged failure to comply with the model rule

requirement under Arkansas Code Annotated section 25-15-215. Because the circuit court

does not have jurisdiction over this claim, it should be reversed and dismissed. I join the

remainder of the majority’s opinion in full.

       Under Amendment 98 to the Arkansas Constitution, the MMC is vested with

broad discretion to adopt any rules necessary to carry out the purposes of the amendment

and to perform its duty to issue cultivation licenses. See Ark. Const., amend. 98, § 8(b).

This discretion is guided by the extensive requirements established by the amendment.

Most relevant here, Amendment 98 commands the commission to adopt rules governing

“[t]he manner in which the commission considers applications for and renewals of licenses

for dispensaries and cultivation facilities.” Ark. Const., amend. 98, § 8(d). It also requires

that the MMC adopt rules governing “[a]ny other matters necessary for the commission’s

fair, impartial, stringent, and comprehensive administration of this amendment.” Id.

Because the MMC’s creation and procedural rulemaking authority expressly derives from

the constitution, it is not subject to the APA’s model rules of procedure provision.

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       The APA does, however, have limited applicability to the MMC. Rules adopted by

the MMC under Amendment 98 are “rules as defined in the [APA].” Ark. Const., amend.

98, § 8(b)(2); see also Ark. Code Ann. § 25-15-202(9)(a) (APA definition of “rule”). To the

limited extent the APA applies to MMC rules, it provides a process for the formulation,

amendment, or repeal of the agency’s rules. See, e.g., Ark. Code Ann. § 25-15-204 (“Rules--

Procedure for Adoption”). It does not, however, impose requirements as to the actual

rules the agency must adopt. Accordingly, to the extent Carpenter Farms disagrees with an

MMC rule or believes additional rulemaking is required, it is not without a remedy. It may

petition MMC for the “issuance, amendment, or repeal of a rule.” Ark. Code Ann. § 25-

15-204(d)(1). Should the agency refuse to act, judicial review is available under section 25-

15-214. Because Carpenter Farms did not avail themselves to this procedure prior to

bringing this action, the circuit court does not have jurisdiction to consider the claim.

       Leslie Rutledge, Att’y Gen., by: Jennifer L. Merritt, Sr. Att’y Gen., for appellants.

       Law Offices of Matt Simmons, Esq., by: Matt Simmons, pro hac vice; and R. Victor

Harper, P.A., by: R. Victor Harper, for appellee.

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