Missouri Minute: State seeks legal help over medical marijuana rollout; Cerner faces 401(k) suit

Good morning, MBA readers,

The wait is finally over for nearly 1,200 applicants hoping to sell marijuana in Missouri. The agency in charge of the state’s medical marijuana program has released its list of who gets to run a dispensary and who doesn’t. The list also includes the scores given to each application during the process, which is proving to be a major flash point for some of those who didn’t make the cut.

Dispensaries were the last of five types of facilities to have their applications scored. All told, the state approved 348 of more than 2,100 applications. But the process was a costly one for many of the applicants who were ultimately denied a license. So far, the state has collected at least $13 million in application fees, and many applicants have invested additional funds on consultants and other startup costs. One Kansas City applicant says she has spent around $160,000 in personal retirement funds to prepare her business. And yet, her application was just short of the score needed for approval.

With roughly 85% of the applications being turned down, several business owners are beginning to complain that the review process was flawed and inconsistent. Mainly, they say that there are substantial discrepancies in the scoring system, which allegedly resulted in applicants receiving vastly different grades for similar answers to basic questions.

In the coming weeks, the state will no doubt receive a flood of appeals. But a number of disgruntled applicants are taking things further, pursuing lawsuits against the state and its regulators. Now, the agency in charge of the program is looking to hire up to three law firms for its defense.

Scroll down to read more on the contentious rollout of Missouri’s medical marijuana program and other business news from around the state.


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State announces list of approved marijuana dispensaries
The Missouri Department of Health and Senior Services released a definitive list of approved medical marijuana dispensaries as well as scores assigned to each application during the process. The agency, which is responsible for administering the state’s medical marijuana program, awarded 192 dispensary licenses statewide out of 1,163 applications. (Columbia Missourian)

Missouri regulators seek legal help to defend medical marijuana rollout
The state has issued a call for bids from law firms as it anticipates litigation from some dispensary applicants who claim they were unfairly denied a license to sell medical marijuana in the state. Contracts will be awarded to up to three law firms on an hourly basis. (St. Louis Post-Dispatch)

Ex-employees sue Cerner over 401(k) fees
Four former Cerner employees have sued the North Kansas City-based health care IT company in federal court, claiming mismanagement of retirement plans that resulted in millions of dollars in excessive fees. The lawsuit argues that Cerner for years failed to explore cheaper investment options, thereby breaching its fiduciary responsibilities under federal law. (Bloomberg Law)

Judge delays Roundup trial, giving Bayer more time to reach settlement
A circuit court judge in St. Louis has postponed opening arguments in a Roundup-related lawsuit to allow attorneys for Monsanto and four plaintiffs to work out a settlement. The case is the first of the Roundup cases against Monsanto and its parent Bayer to combine multiple cancer claims about the weedkiller. (St. Louis Public Radio)

Tyson Foods to invest $27 million in St. Louis-area plant, add 100 new jobs
The Arkansas-based food conglomerate plans to add three new production lines that will boost annual production by about 16 million pounds. The upgrade, expected to be complete by March, will create 100 new jobs at the plant, which makes pre-packaged sandwiches and related bread products, the company said. (St. Louis Business Journal)

Arvest Bank names new Springfield market president
Kyle Hubbard, a 17-year veteran of the Arkansas-based bank, will take over as head of Springfield operations. Hubbard, who has served as the bank’s president and CEO in Oklahoma, succeeds Brad Crain, who announced his retirement last week. (Springfield Business Journal)

Bi-State officials scuttle Loop Trolley reboot plan
A plan for the Bi-State Development Agency to run the troubled St. Louis Loop Trolley is at risk after commissioners decided not to advance it on Friday. With no other proposal to save the 2.2-mile streetcar line, the Federal Transit Administration could sue to recover $25 million in funding. (St. Louis Post-Dispatch)

Proposed measure would double sales tax revenue for KC fire department
The Kansas City Council has approved a ballot measure that will ask voters in April to decide whether to increase the city sales tax to half a cent, up from a quarter cent. The measure would raise an additional $21 million a year for the city’s fire department to help maintain buildings and buy new vehicles. (KCUR)

St. Louis County issues new call for Jamestown Mall redevelopers
The St. Louis County Port Authority has released a new request for proposals from developers looking to revive the abandoned Jamestown Mall. County officials have been trying to redevelop the site since it closed in 2014. (St. Louis Post-Dispatch)

Hazelwood launches new grant for entrepreneurs
The city has partnered with Somera Road, a New York-based commercial real estate firm, to award up to $10,000 for startup costs plus free rent in the Village Square center. The program is aimed at supporting local entrepreneurship while revitalizing the retail space. (St. Louis Public Radio)


Say that again

“The FDA is going to kill ‘mom and pop.’ They’re going to hand the industry over.”

That’s Justin Price, the former owner of a vape shop in Oakville, who says small shops like his may be on their last legs amid pressure from regulators and health advocates, the St. Louis Post-Dispatch reports. Over the past decade, the vaping industry has enjoyed constant growth and mostly lax regulations. For five years, Price was part of the vaping boom. But by late 2018, Price could see the vaping boom would not last for long and closed shop. According to the American Vaping Association, vape sales are down between 25% and 30% across roughly 10,000 vape stores nationwide, with much of the burden falling on small shops like Price’s. While big companies like Juul may be able to weather the storm, some shop owners say they’ve lost half their business over the past six months.


Go figure

$59 million

That’s the estimated economic impact a Kansas City Chiefs victory in the Super Bowl would have, based on one study. Michael Davis, an economics professor at the Missouri University of Science and Technology, argues that an average NFL team with 10 or 11 wins in a season will fuel about $100 in additional income per capita in its community. His 2010 study, which analyzed data going back to 1969, estimates that a Super Bowl win could spur another $20 in economic boost per person on average. That could mean millions for Kansas City, which had an estimated population of more than 490,000 in July 2018. “If the local football team does well, you are happier,” Davis told Missourinet. “Therefore, that happiness will then translate into either you being more productive at work … or you consume more.”


Hello, my name is

Boddle and PlaBook

These two Kansas City-based education technology startups both won $50,000 grants from Opportunity Hub Kansas City and a ticket to this year’s South by Southwest festival, Startland News reports. Boddle produces educational games for homework and tests. PlaBook uses artificial intelligence to help learning outcomes. They were the two Kansas City-based startups among five Opportunity Hub Kansas City companies to advance to a demo day at SXSW in March.


It’s been a pleasure doing business with you this morning.


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